Autumn Statement: Insurance premium tax rate raised – again
The government will raise the insurance premium tax rate to 12% from June 2017, Chancellor Philip Hammond has announced in the Autumn Statement today.
IPT has risen rapidly from 6% to 9.5% in November 2015 and then to 10% in October 2016.
Hikes in the tax are usually passed onto general insurance premiums such as home insurance.
Hammond said: “Insurance premium tax in this country is lower than in many other European countries and half the rate of VAT.
“In order to raise revenue, which is required to fund spending commitments I am making today, it will rise from 10% currently, to 12% from next June.”
David Whittaker, managing director of Mortgages for Business, said: “I expect that the impact of measures announced in the Autumn Statement on residential landlords will be minimal.
“For example, landlords should be more than able to absorb the increased cost of insurance premiums.”