No lowering of taxes seen on non-life insurance

MANILA, Philippines - The long-proposed reduction in the taxes of non-life insurance products may not be legislated under the present administration, an umbrella group of non-life insurers in the country said over the weekend.

Michael Rellosa, deputy chairman of the Philippine Insurers and Reinsurers Association (PIRA), told reporters non-life insurers are not optimistic the proposed lowering of the taxes for non-life products would be considered by the Duterte administration as it goes against the government’s priorities.

“You see it goes against the plan of the government. The government wants to fund all these (infrastructure) projects,” Rellosa said.

“As a matter of fact, they are actually increasing taxes so I don’t think policy speaking, we are going to get it in any ground,” he added.

The non-life sector has long been lobbying for the reduction of the 27.5 percent tax levied on non-life insurance products. However, the previous bill seeking for the adjustment failed to secure the approval of the Aquino administration.

The life insurance industry, on the other hand, already enjoys a lowered rate of five percent imposed on their products.

Despite this, Rellosa said PIRA would still continue pushing for the reform.

“We are continuing our lobby and as a matter of fact, Congressman Miro Quimbo refiled the bill, but if it’s going to progress that is a different story,” he said.

The Marikina solon had earlier asserted that taxes levied on non-life products should be at five percent, the same tax percentage imposed on life insurance policies.

In 2016, the net premium written by the non-life insurance industry grew 16.24 percent to P41.6 billion from P35.8 billion in 2015.

Net income, meanwhile rose 2.66 percent to P3.37 billion from the P3.29 billion posted the previous year.

For the first quarter of 2017, net premiums written by the sector increased 19.4 percent to P10.89 billion, as compared to P9.12 billion recorded a year ago.