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Budget threat to medical insurance
The government is expected to double the rate of insurance premium tax to 10% at the budget which will net £6 billion in revenues.
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The government is expected to double the rate of insurance premium tax to 10% at the budget which will net £6 billion in revenues.
A move by Chancellor George Osborne to drive up the tax on premiums for car, home and private medical insurance could have unexpected consequences, warned The Association of Medical Insurance Intermediaries.
Making private medical insurance more expensive would only increase consumers reliance on the National Health Services, warned Andrew Tripp, chairman of Amii. 'It is short-sighted to be threatening this at a time when we are talking about reducing government spending and calling on those individuals with the resources to do it to be more responsible for their health and wellbeing.’
The Treasury is already thought to collect £2.3 billion in tax revenues from the current 5% insurance premium tax. The government could even raise the tax on general insurance premiums to 17.5% bringing it inline with the rate levied on travel insurance policies and extended warranties.
Insurance premium tax would be a soft target for Osborne looking to boost tax revenues for his budget on 22 June.
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1 comment so far. Why not have your say?
Samsyn
Jun 16, 2010 at 01:38
I took out PMI at age 50 and faithfully paid my premiums ever since. Never had a claim till late last year when I was diagnosed with prostate cancer which required radio-therapy. Total cost of my treatment was around £10k, 75% was paid by WPA which I must say treated me extremely well and were most efficient and compassionate in all my dealings with them. The other 25% I paid as I had a shared responsibility policy which was my choice......around £2.5K
I had 37 treatments, five days a week for almost eight weeks. I made the round-trip of 120 miles daily, losing time from work (I'm self-employed small one-man business) and paying for my own motoring expenses. I watched many of my fellow patients who had much younger cars than I did claim mileage expenses, they bragged about being on DLA, some even claimed for meals.....one even arrived by taxi each day which I know cost the NHS £80 per day. I asked him if he had a car and his reply was 'Why should I drive myself when the 'system' is there to drive me?'
I'm not surprised that the country is in the present financial chaos and quite honestly I'm not complaining at this stage, however if the budget adds further tax to my premiums I will simply cancel my PMI and start milking the system like so many others. I received exactly the same treatment as my fellow patients and I paid my way.....I don't want a pat on the back, but I don't expect to be further burdened by the tax-man. Please take note Mr Cameron.
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