Changes to the Rate of IPT (Insurance Premium Tax)In the 2010 emergency budget, IPT was increased from 5% to 6% in line with the increase in VAT. The increase will take place on the 4th January 2011. It is currently estimated that IPT will raise £2.3 Billion in tax per year. It was feared by the insurance industry it could be doubled to bring it in line with other European Countries, where the average is 10%. However, in Germany it is 19% and Italy 22%. There are some exemptions in the payment of IPT, for example, commercial goods in international transit and risks located outside the UK.
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