15/07/2015 Budget Announcement – Insurance Premium Tax Rise
In the first budget speech of the new Conservative Government, Chancellor of the Exchequer George Osborne has announced that the government will raise the standard rate of Insurance Premium Tax (IPT) from its current rate of 6% to 9.5%. The new rate will take effect from November 2015.
The shock move to hike IPT has been greeted with dismay by BIBA Cheif Executive Steve White. Responding to George Osborne’s announcement of an increase in the IPT rate to 9.5% White said: “We are extremely disappointed in this rise in insurance premium tax and will mean insurance will become more expensive for the public as a result”.
The Insurance Industry as a whole seems disappointed with the move as it will not only bring unwelcomed uplifts in premiums, insurers and brokers will also take a blow.
Insurance Premium Tax was introduced 1994. It last rose in January 2011 by 1% from 5% to 6%.