In the third part of our upcoming Business Today feature on the Insurance Premium Tax Ian Crowder, head of PR at the AA describes the impact on the company itself:
“The Treasury somewhat disingenuously suggests that IPT could be absorbed by insurers but given that currently, the value of claims and costs, driven by still growing numbers of whiplash injuries exceeds income from premiums the industry has little capacity to do so and it is unlikely that any will. In any case, like VAT, it is an indirect tax on consumers that the insurance industry is expected to collect,” Crowder said.
“The timing couldn’t be worse given that premiums are starting to rise again and we expect to see that upward trend continue. There is no doubt that the Treasury has been perhaps taken aback by the response to IPT increases and the industry continues to lobby Government to think again.”
In the final part of our upcoming Insurance Premium Tax feature Adrian Smith, KPMG analyst will reveal that businesses might find a way out of paying higher IPT...