Insurers warn against IPT rise in the Budget
The financial sector is braced, as is the entire country, for the imminent austerity measures to be introduced in this week’s Budget to address the crippling deficit the United Kingdom faces.
One of the taxes thought likely to rise is Insurance Premium Tax (IPT).
Steve Howell, of CBG Group, has warned against a substantial rise in IPT, asserting that such a measure would dissuade householders from taking appropriate cover, or even from taking it out at all.
Howell added that an IPT increase would combine with the high cost of premiums young drivers face for motor insurance to decrease the number of motorists driving with insurance.
Elite Insurance’s Charles Wright agreed with Howell’s suggestion that an IPT rise would lead to an increase in the number of uninsured drivers, leading to an increased burden on insured drivers.
Howell went on to state that the timing was a potential pitfall, as many businesses are looking for opportunities to decrease costs, and rising insurance costs would prove a deterrent to taking out appropriate coverage.
Concern has also been raised about the highly likely increase to capital gains tax (CGT) in the Budget.
However, Defaqto have claimed a rise in CGT could have a beneficial impact on insurance bonds.
Category: Insurance News
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