Carney: UK is ‘investment banker for Europe’

The governor of the Bank of England has repeated his calls for a “smooth and orderly” UK exit from the EU, saying that a transition out of the bloc will happen, it was just a case of “when and how”. Responding to the BoE’s latest bank stress tests, where lenders overall emerged with more resilient […]

Continue Reading


China capital curbs reflect buyer’s remorse over market reforms

Last year the reformist head of China’s central bank convinced his Communist party bosses to give market forces a bigger say in setting the renminbi’s daily “reference rate” against the US dollar. In return, Zhou Xiaochuan assured his more conservative party colleagues that the redback would finally secure coveted recognition as an official reserve currency […]

Continue Reading

Capital Markets

Mnuchin expected to be Trump’s Treasury secretary

Donald Trump has chosen Steven Mnuchin as his Treasury secretary, US media outlets reported on Tuesday, positioning the former Goldman Sachs banker to be the latest Wall Street veteran to receive a top administration post. Mr Mnuchin chairs both Dune Capital Management and Dune Entertainment Partners and has been a longtime business associate of Mr […]

Continue Reading


Financial system more vulnerable after Trump victory, says BoE

The US election outcome has “reinforced existing vulnerabilities” in the financial system, the Bank of England has warned, adding that the outlook for financial stability in the UK remains challenging. The BoE said on Wednesday that vulnerabilities that were already considered “elevated” have worsened since its last report on financial stability in July, in the […]

Continue Reading


China stock market unfazed by falling renminbi

China’s renminbi slump has companies and individuals alike scrambling to move capital overseas, but it has not damped the enthusiasm of China’s equity investors. The Shanghai Composite, which tracks stocks on the mainland’s biggest exchange, has been gradually rising since May. That is the opposite of what happened in August 2015 after China’s surprise renminbi […]

Continue Reading

Categorized | Insurance

Insurance premium tax hike ‘will cost families extra £21 a year’

Posted on November 23, 2016

Insurance companies and consumers who want to protect their assets were among the bigger victims of Philip Hammond’s Autumn Statement and they are clearly not happy about it, as Axa branded a further hike in the insurance premium tax from next summer as an “unwarranted attack” on the industry.

To recap, Mr Hammond intends to raise the levy – a tax on general insurance premiums including car and home insurance – from 10 per cent to 12 per cent from June next year.

Amanda Blanc, chief executive of Axa UK, pointed out the move is the third increase in 18 months, calling the latest hike “an unwarranted attack on millions of people simply looking to protect themselves, their families and their key assets”.

“This is a classic case of the Government giving with one hand, in the form of whiplash reforms, and taking with another,” she said referring to Mr Hammond’s pledge in the Autumn Statement to legislate to end the “compensation culture” around such claims – a move the industry welcomes.

“The affordability of insurance is being fundamentally threatened,” she added. “The country is already underinsured and ever rising insurance taxation could have the unintended consequence of making this situation even worse.”

Daniel Lyons, a tax partner at Deloitte, suggests the industry would have been caught off guard by the move, given that the tax had already been raised in the Budget earlier this year. He said:

This will cost the average family – with a house and two cars – an extra £21 a year, bringing their total IPT [insurance premium tax] cost to £126 annually. In less than two years, the IPT rate will have increased by 6%, doubling the rate. This will be unwelcome news for both insurers and consumers.

Simon McCulloch, director of, a price comparison website, said:

Our estimates are that, as a direct result of the Government’s increases in IPT, drivers will have to fork out an extra £109 than they paid two years ago to pay for their insurance. We calculate that the average annual motor premium will cost more than £700 going into the new year.