The New South Wales Financial Relations Review draft report has called for the abolition of insurance-based taxes.
The New South Wales Financial Relations Review is the latest in a long list of inquiries to call for the abolition of insurance-based taxes. The draft report made a number of recommendations calling for ambitious tax reform by both State and Federal governments.
Among the recommendations was the abolition of insurance-based taxes such as Stamp Duty and the Emergency Services Levy and the introduction of a broad-based property levy to ensure efficient funding of fire and emergency services into the future.
The National Insurance Brokers Association (NIBA) welcomes the release of the draft report and strongly supports its findings that insurance-based taxes are “unfair, inefficient and shift risk onto those least able to bear it”.
The report also highlighted the link between insurance taxes and under-insurance stating that they “drive up premiums and discourage consumers from adequately insuring”. To support this finding the report pointed to the uptake of insurance products following reforms to insurance taxes in Victoria and Western Australia.
NIBA CEO Dallas Booth said, “This report is an important and timely contribution to the emerging debate about how Australia’s economy will recover from the events of the past nine months.”
“The way forward will require bold thinking, the NSW Premier and Treasurer have been provided with a rare opportunity to create a more equitable, efficient tax system that delivers better outcomes for NSW residents without increasing the taxation burden on consumers who are already experiencing financial difficulties.”
“NIBA has long argued that taxes on insurance are counterproductive and unfair to those who do the responsible thing and insure their properties.”
“NIBA supports the inquiry’s calls for the NSW government to stop penalising responsible property owners and abolish insurance-based taxes.”
NIBA will review the draft report’s findings in consultation with its members and looks forward to providing its feedback to the panel. You can read the entire draft report here.