Yet another Insurance Premium Tax rate rise

Wed 23 Nov 2016

In today’s Autumn Statement the Chancellor announced that there will be another rate rise in IPT. The standard rate of IPT will go up to 12% in June 2017.

This will be the third IPT rate rise in just over 18 months.  It means the standard rate of IPT will have doubled from 6% to 12% in a short period.  Whilst IPT is a tax on insurers the increased cost will almost certainly be passed onto consumers.  In the 2014/15 tax year IPT revenues were worth £3.2 billion to the Treasury.  That was when the tax was at 6%.  A further 2% increase means the additional revenue raised may well be in excess of £750 million a year.  The average cost to a typical family with a house and two cars to insure will be something in the region of an extra £22 a year on top of the IPT they are already suffering.  Unwelcome news for insurers and consumers.

For more information contact Linda O’Sullivan (linda.o’sullivan@mazars.co.uk).