The Insurance Council of Australia welcomes the Johnson Report’s proposal to remove state insurance taxes and rationalise regulation, reasoning that “it draws much needed attention to the handicap that state insurance taxes place on the competitiveness and efficiency of the general insurance industry.”
The report by the Australian Financial Centre Forum, led by former Macquarie Bank chief executive Mark Johnson, listed 19 recommendations which have received support from the financial services industry.
The Insurance Council has undertaken extensive economic modelling work in order to demonstrate to its members the case for removing state insurance tax. It shows how these taxes encumber insurance consumers with additional costs making general insurance products less affordable. The council found that “as a result of state insurance taxes there is a detrimental impact on consumers taking out general insurance premiums in order to take individual responsibility for their own risk.”
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