Insurance Premium Tax (IPT) rose to 12 per cent last week, yet again increasing the cost of doing business for small firms. IPT has doubled over the past five years and, unlike VAT, small firms cannot claim back the cost of it.
The Federation of Small Businesses (FSB) is calling for no further hikes in IPT over the next parliament. Mike Cherry, FSB National Chairman, comments: “Having absorbed a recent rise in the National Living Wage and a business rates revaluation, there will no doubt be many small firms thinking twice about taking insurance policies as a result of this tax grab. If insurance premiums continue to increase, small business take-up of insurance will dip, and it will be those most at risk that will be affected.
“The next Government should promise no further hikes in IPT for the new Parliament. This poorly thought through tax rise discourages good behaviour and is yet another hidden cost keeping our entrepreneurs awake at night.”
Whilst the political environment remains convoluted and confrontational, our experts at Beavis Morgan understand the demands placed on individuals and businesses. We are readily available to provide you with the right advice and solutions to help you improve your net worth and increase growth and profitability.