With the pound now at parity with the Zimbabwe Dollar and inflation set to hit 1000% by Christmas, the Government has some important economic decision making to do.
Not the least of the decisions it needs to take is how to drum up some extra tax revenue, now that insurer ‘body’ the ABI has formally forbidden it from raising IPT again as part of Phillipe Hammond’s forthcoming Autumn Collection.
The Association of Brutish Insurers has put Theresa May on notice that she needs to find some irresponsible people to tax instead of ramping up the IPT (or Insane Punishment Tax) levied on insurance sales.
“Stop this raid on the responsible,” the ABI demands. Otherwise people will stop buying insurance and then where will we be! IPT is an especial blight, the insurer body argues, on the millions of families who are “just managing” i.e. precisely the people T-May has said she wants to help.
Just managing families are essentially good people. They genuinely want to buy insurance; but if IPT turns them all from just managing to not quite managing they might start abandoning or diluting their commitment to insurance purchase.
The government should freeze IPT, the ABI says, or, better still, reduce it. People should be rewarded, not penalised, for “doing the right thing” Jim Dalton of the ABI says. “Any further hike in IPT,” he warns, would “affect millions of people directly in their pockets.”
If HMG ignores the ABI and whacks up IPT anyway later this month, perhaps insurers could do what the supermarkets are doing with exchange-rate fuelled food price increases and ‘absorb’ any IPT hike to protect the pockets of their policyholders.
Just managing insurance fans would certainly appreciate that!
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