Gerald Nash
Ceist:177. Deputy Ged Nash asked the Minister for Finance the estimated yield to the Exchequer from an annual levy on insurance firm profits at a rate of 1%; and if he will make a statement on the matter. [38690/22]
Amharc ar fhreagraWednesday, 13 July 2022
Ceisteanna (177)
Freagraí scríofa
At the outset, it is important to note there are various levies and contributions in existence on insurance premiums. These serve different, defined purposes with some having been in place for a number of years. I should also state that there are no plans to discontinue them at this time. These are briefly detailed below.
The 2 per cent Insurance Compensation Fund (ICF) levy is the only pure "levy" charged on insurance premiums. This is charged to fund the ICF, which covers the cost of claims in this State where an insurer goes into liquidation. This levy was in place from 1984 to 1992 and was reintroduced in January 2012. It currently applies at a rate of 2 per cent of premiums received on all non-life insurance policies and its purpose is primarily to repay the Exchequer for funding the administration of Quinn Insurance. As there is still a significant amount owing to the State, the levy is likely to be applied for most of the remainder of this decade.
Separately, while there is not a 1 per cent insurance levy, the Deputy may be referring to the stamp duty charged on life insurance premiums, which is occasionally described as a levy. However, this is recorded to the Exchequer as a tax receipt jointly with a separate 3 per cent stamp duty charged on certain non-life premiums. As such, it is not possible to differentiate both distinctly. Information on Stamp Duty yields, which includes these Life Assurance and Non-Life Insurance Levy components from 2010 onwards, can be found on the Revenue website statistics page: www.revenue.ie/en/corporate/documents/statistics/receipts/stamp-duty-receipts.pdf. However, since 2010 the total amount collected under these specific stamp duties has totaled c.€1.8 billion.
Finally, the Deputy may wish to note the Motor Insurers Insolvency Compensation Fund (MIIC Fund) is a contribution equivalent to 2 per cent of gross motor premiums, which is provided by motor insurers. This is not considered a levy as the decision rests with the insurance companies as to how this is financed i.e. either through absorbing it or passing it onto consumers. This ensures the compensation levels payable from the ICF for third party motor insurance claims as a result of a motor insurer insolvency is now aligned with that where a motorist is in a collision with an unidentified or uninsured driver.
The contribution rate is subject to an annual review by me in my role as Minister of Finance. Currently, it is expected to continue for a number of years.
Question No. 178 answered with Question No. 150.