MANILA, Philippines – The non-life insurance sector is backing a proposed measure that will cut taxes imposed on its products.
In a press briefing, Philippine Insurers and Reinsurers Association (PIRA) deputy chairman Michael Rellosa said the group was still hopeful the Department of Finance (DOF) would support the bill that seeks to lower the 27.5 percent tax levied on non-life insurance products.
“We’re keeping our fingers crossed, hopefully the DOF sees the wisdom of this looking forward,” said Rellosa, who also chairs the ASEAN Insurance Council.
“I think they know it, it’s just that they want to put all the tax laws together in one bill so that’s where we are at the moment,” he added.
Rellosa said the proposed bill was refiled by Davao Rep. Karlo Nograles in Congress after failing to secure the approval of the Aquino administration.
House Deputy Speaker Miro Quimbo also signified his support for the bill.
Quimbo stressed the role of insurance to help citizens recover, especially during times of disasters. With this, he said it was “illogical” for the government to charge them a 27.5 percent tax when they buy non-life insurance coverage.
“We live in one of the most disaster-prone countries in the world, which makes it truly ironic that we have one of the highest taxes for non-life insurance. It doesn’t makes sense,” Quimbo said during a presentation at a recent PIRA conference.
“You tax something that you do not want people to buy. In our case, we should be encouraging our people to buy insurance as a way of empowering them,” he added.
The Marikina solon said that taxes levied on non-life products should be at five percent, the same tax percentage imposed on life insurance.
“It must at least be equal if not lower,” he said.
Quimbo said taxes on insurance must be “simple, efficient and equitable to all.