David Stevens says tax hurts those who can least afford it and should be a flat levy
Insurance premium tax (IPT) is charged the wrong way and should be a flat levy rather than a percentage of premium, according to Admiral chief operating officer David Stevens.
Stevens’s comments follow the government’s plans to raise IPT to 9.5% from the current level of 6% from November.
Speaking to journalists after the release of Admiral’s first-half 2015 results, Stevens noted that because IPT is charged as a percentage of premium, those who pay the highest premiums are the worst hit. Those charges most for insurance are typically younger drivers from deprived areas.
He said: “It is a shame the IPT works the way it does because it hurts people who can least afford it.
“Younger drivers living in poorer parts of the country tend to pay higher premiums than older drivers living in the suburbs.
“We think that is the wrong way of charging the tax. It should be a fixed levy. Maybe about £35 for everyone would bring in the same amount of revenue.”