To ask the Chancellor of the Exchequer, if he will make it his policy to exempt people affected by dangerous cladding from Insurance Premium Tax.
14 January 2021
Insurance Premium Tax is a tax paid by insurers on all general insurance premiums. Insurance pricing is a decision which is affected by a wide range of factors, and the taxes that insurers pay are just one part of this. It is hard to predict the impact of an exemption on insurance pricing for those affected by unsafe cladding, as this largely depends on how the insurers would react. In addition, any loss in tax revenue would have to be balanced by a reduction in public spending, increased borrowing or increased taxation elsewhere.
While there is no current plan to introduce an exemption on insurance pricing for those affected by unsafe cladding, all taxes are kept under review and the views expressed to us are carefully considered as part of the annual Budget process.