The government is unlikely to make exemptions on Insurance Premium Tax (IPT) despite the growing clamour from one sector.
In a written statement to Parliament, financial secretary to the Treasury Jane Ellison MP hinted that it was improbable to exempt certain sectors from IPT, which will soon increase for the third time.
“While all tax policy is kept under review, it would be challenging to implement an exemption for insurance purchased by any specific group,” Ellison said.
She also said that it was “up to insurers to decide whether to pass on any tax paid.”
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Ellison was responding to a written question in Parliament that requested the Chancellor’s assessment of IPT’s potential impact on charities.
Ellison said the government continues to support charities and their donors, including through tax reliefs worth over £5 billion from 2015 to 2016.
“Treasury Ministers and officials meet with a wide range of companies and organisations, including charities and their representative bodies, to discuss relevant issues,” she said.
Earlier this month, Access Insurance launched a petition urging the government to introduce a simple exemption or reduction in IPT for all UK-registered charities.
The company said that after the tax rate climbs to 12% in June, charities will be paying about £48,000,000 in IPT, an amount that could be used instead for other purposes.
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