Regulator backs calls for tax exemption

Asia

The insurance regulator in Philippines has joined the industry in demanding that the tax on insurance premiums be scrapped. Insurance Commissioner Eduardo Malinis has said that removal of the tax would improve insurance penetration in the country. Mr Malinis acknowledged that it might be difficult to persuade the ministry of finance to scrap the 5% tax on insurance premium at a time when it was engaged in maximising its revenue resources. “Insurance is a form of savings. You have to pay tax for saving,” he said. He pointed out that neighbouring countries in Asia did not have such a tax. The Capital Market Development Council, a government body, recently suggested reducing tax on premiums to 2%.