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Insurance Premium Tax now 12% but NO PRICE RISE for Insurance2go customers
Insurance Premium Tax now 12% but NO PRICE RISE for Insurance2go customers.
As of 1st June 2017 the rate of Insurance Premium Tax reached its highest level since its introduction in 1994. The standard rate of Insurance Premium Tax or IPT was increased from 10% to 12% for standard Insurance Policies.
However, Insurance2go are delighted to announce that we are not increasing prices, we are absorbing the tax increases and not passing them onto consumers as we always try to do.
Insurance customers have come under increased pressure after three increases in IPT in quick succession in recent years.
The Tax was introduced in 1994 by the then Chancellor Kenneth Clarke. Originally the rate was set at 2.5%. This was then increased to 4% in April 1997. The pricing was then increased over the years in various increments to the new rate of 12% that came into effect on the 1st June.
In 2009 / 10; IPT raised £2.3 billion for the government. At that time, the rate was just 5%. Now with the rate being set at 12% it will generate far more for government coffers.
At Insurance2go we pride ourselves on trying to keep pricing as competitive as possible and we have absorbed this IPT increase to protect our customers. Let’s hope the government don’t look to Germany where the rate is an eye watering 20%!