Insurance sector pays third-highest corporate tax
First-ever survey reveals UK insurers contribute £5.5bn to government's tax coffers
Insurance companies in the UK have contributed £5.5bn in tax to the
government’s coffers, research by the Association of British Insurers has
revealed.
The group’s members paid £3.1bn in taxes for 2006-2007, ranking it as the
third-highest amount of corporation tax of any sector.
In addition, insurance companies also collected an additional £3.4bn in tax
on behalf of government through taxes such as PAYE, employee National Insurance
(NI) and Insurance Premium Tax (IPT).
The data is the first ever analysis of the insurance industry’s contribution
to the Treasury, and takes into account all direct and indirect taxes as well as
employment and environmental taxes.
Peter Vipond, director of financial regulation and taxation at the ABI, said
this reflected how large and successful the industry is.
‘We hope that the government keeps working with insurers to improve the tax
system so that this dynamic sector can operate successfully, both within the UK
and globally,’ said Vipond.
Current tax issues insurers face include the operation of taxation for life
insurance, the taxation of foreign profits, an EU VAT review, and the tax
treatment of annuities.
Insurers pay out more than £160m a day in pension and life insurance
benefits and a further £57m per day in general insurance claims, and employ some
320,000 people in the UK.
Further reading:
HMRC
report on corporation tax