Post by northwestman on Mar 13, 2024 15:55:40 GMT 1
I've commented frequently on the unfairness of freezing personal tax allowances as being a 'stealth tax'
But until reading this article, I wasn't understanding as to why all insurances have gone up by over 50% this year without any real scrutiny.
www.thisismoney.co.uk/money/mailplus/article-13188871/The-8-2bn-stealth-tax-family-Britain-paying.html
The profits and share prices of the country’s major insurance companies are booming as they impose ever-higher premiums on customers.
But it’s not just the insurers that are reaping the rewards of this premium bonanza — the Government is also rubbing its hands in glee.
Figures released by the Office for Budget Responsibility (OBR) — in response to the Chancellor of the Exchequer’s Budget — show that the taxes the Government is generating from insurance premiums are currently higher than from much despised inheritance tax.
The current revenue from insurance premium tax (IPT) levied on sales of most types of insurance cover stands at a staggering £8.2 billion a year — £0.6 billion more than the tax raid on family inheritances, and not far behind the tax obtained from tobacco sales (£8.8 billion).
In very simple terms, the bigger premiums that insurers charge their customers, the greater the Government’s tax-take.
In the tax year ending April 2023, IPT receipts totalled £7.5billion while ten years ago, in the tax year ending April 2014, they were just a tad over £3billion.
Furthermore, according to the OBR, the annual tax grab from IPT will continue to rise over the next five years to £8.8 billion in the tax year ending April 2029.
Some also passionately argue that the Government has deliberately turned a blind eye to rampant insurance premiums because higher prices mean a greater tax-take.
IPT is currently charged at 12 per cent on mainstream policies such as household, motor, private medical and pet cover. Some covers, such as travel insurance, attract a 20 per cent charge.
The latest data from comparison website Confused.com shows that the average cost of car insurance is now £995 — 58 per cent higher than a year ago.
Prices, the firm says, are at their highest level since it started compiling data 18 years ago. Both the young and old are bearing the brunt of this surge in premiums.
But until reading this article, I wasn't understanding as to why all insurances have gone up by over 50% this year without any real scrutiny.
www.thisismoney.co.uk/money/mailplus/article-13188871/The-8-2bn-stealth-tax-family-Britain-paying.html
The profits and share prices of the country’s major insurance companies are booming as they impose ever-higher premiums on customers.
But it’s not just the insurers that are reaping the rewards of this premium bonanza — the Government is also rubbing its hands in glee.
Figures released by the Office for Budget Responsibility (OBR) — in response to the Chancellor of the Exchequer’s Budget — show that the taxes the Government is generating from insurance premiums are currently higher than from much despised inheritance tax.
The current revenue from insurance premium tax (IPT) levied on sales of most types of insurance cover stands at a staggering £8.2 billion a year — £0.6 billion more than the tax raid on family inheritances, and not far behind the tax obtained from tobacco sales (£8.8 billion).
In very simple terms, the bigger premiums that insurers charge their customers, the greater the Government’s tax-take.
In the tax year ending April 2023, IPT receipts totalled £7.5billion while ten years ago, in the tax year ending April 2014, they were just a tad over £3billion.
Furthermore, according to the OBR, the annual tax grab from IPT will continue to rise over the next five years to £8.8 billion in the tax year ending April 2029.
Some also passionately argue that the Government has deliberately turned a blind eye to rampant insurance premiums because higher prices mean a greater tax-take.
IPT is currently charged at 12 per cent on mainstream policies such as household, motor, private medical and pet cover. Some covers, such as travel insurance, attract a 20 per cent charge.
The latest data from comparison website Confused.com shows that the average cost of car insurance is now £995 — 58 per cent higher than a year ago.
Prices, the firm says, are at their highest level since it started compiling data 18 years ago. Both the young and old are bearing the brunt of this surge in premiums.