Insurers are paying 50% more in corporation tax than they were two years ago, according to new ABI figures.
A study of ABI member companies, carried out by PwC, shows insurers contributed £10.4bn worth of tax receipts to the Exchequer in 2010. This included £2.7bn in corporation tax- the third highest figure paid by any sector.
This sum, which equals 6.4% of the government’s total corporation tax take, represents a 50% increase compared to the previous year and exceeds pre-recessionary payments.
According to the ABI, the £10.4bn figure more than covers the Home Office’s entire £10.2bn budget. It would also pay for the combined running costs of the Foreign Office, Communities and Local Government and Transport departments.
ABI director general Otto Thoresen said: “Insurers are crucial to the economy. Our total tax contribution is now higher than it was before the recession showing the important role the insurance industry is playing in the recovery and how resilient the industry is during tough times.
“These figures highlight the importance of consistent, competitive tax rules which could help the industry to grow further so that it can continue to make an important contribution to the UK coffers. We are talking to the Government about how to make the UK tax system an asset for the UK when it comes to retaining and attracting insurers to the UK. It is important we encourage our good, successful UK businesses to expand and grow rather than having rules which make the UK a less attractive place to base a business
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