Plans for another increase in insurance premium tax?
“There is a widespread belief in the insurance industry that George Osborne is planning on another increase in Insurance Premium Tax (IPT) in his budget tomorrow.
“I sincerely hope that this is not the case. The IPT has already been raised from 6% to 9.5% and a further 3% would mean that the tax has more than doubled in just six months! This would see young drivers facing even higher insurance costs, penalising those who most need our support. Young people need to be able to drive, not just for freedom but to significantly improve their chances of finding employment. Increasing their cost of insurance is therefore a very short sighted move and there is also a risk that higher costs lead to more uninsured drivers on our roads.
“While we try to absorb as many of these increases as possible, so that our young customers don’t have to, as a business we just can’t keep doing it. In the past year we have managed to decrease the cost of an average premium - a trend that we want to see continue. Unfortunately that’s just not possible with a Government that continually attacks the insurance sector in this way.
“When is the Government going to take a sensible approach to young drivers? Advanced technology such as telematics is not only proven to save lives but can successfully keep the costs down for young people; creating a wealth of talent for businesses to recruit.”