Raising insurance premium tax will be a gift to cowboy builders, warns FMB

Hiking insurance premium tax (IPT) will hit homeowners by encouraging a rise in cowboy builders, the Federation of Master Builders (FMB).

Ahead of the Chancellor’s Spring Budget, the organisation sough to warn Philip Hammond that raising IPT would undermine good builders who play by the rules.

“The doubling of IPT over the past two years has troubling implications for construction SMEs and home owners alike. This stealth tax, which is set to rise for the third time in 18 months, effectively provides an additional competitive advantage to unscrupulous and uninsured builders,” said Brian Berry, the FMB’s chief executive.

“By driving up the costs of insurance, it punishes those businesses that play by the rules and make sure that they are always covered. This is increasing the danger that home owners could be tempted to opt for uninsured builders who are able to offer a more competitive quote.

“This stealth tax may also discourage clients taking out a warranty on building work, which is never advisable practice on a significant building project and could lead to plenty of heartache for consumers further down the line. It’s vital that we get a commitment from the Government that this third rise of IPT will be the last for this Parliament.”

James Dalton, director of general insurance policy at the Association of British Insurers, added: “IPT is a tax on businesses, especially SMEs that often operate on very tight margins and that do the right thing by purchasing insurance to help manage their risks.

“At a time of continued economic uncertainty, with many firms facing increasing costs, the last thing they need is a further hike in IPT. Unlike VAT, no element of IPT can be reclaimed by businesses meaning they will have to absorb these extra costs – this could cost jobs, drive up prices or companies may decide to reduce their insurance cover, putting them at risk if something goes wrong. Enough is enough, give firms a break and freeze IPT.”

Your News

If you've got a story that would be of interest to Builder & Engineer readers, send us an email

Features

2017-03-21 10:31

With the demand of oil increasing, it’s estimated that the Earth will reach its full capacity for oil consumption at some point within the next 20 years. This is despite the production of oil decreasing, and the construction industry is no exception to this, reports Niftylift.

2017-03-17 11:55

With construction firms leading the way in drone technology, Claire Cameron takes a closer look at how unmanned aerial vehicles (UAVs) can be used onsite

2017-03-07 17:20

While the physical safety of workers is prioritised on construction sites, mental health is often overlooked, reports Claire Cameron

2017-02-28 15:53

As part of an ongoing revamp, the Joint Contracts Tribunal has rolled out an updated suite of standard form construction contracts for Design & Build. John Cleaveley, partner and head of construction at Weightmans LLP, takes a look at the changes

2017-01-04 10:35

As pressure mounts to achieve the government’s housebuilding objectives, the effective regeneration of brownfield land is becoming increasingly important. Builder & Engineer takes a look at the challenges of regenerating contaminated land

2016-12-30 10:15

New colour-coded system will see traditional helmet colour head out of site

2016-12-30 10:04

Building Information Modelling – or BIM as it is more commonly known – has become something of a buzz word for the construction sector since the Government launched its Construction 2025 strategy in 2011. Claire Cameron investigates why firms should be embracing the technology

2016-12-19 13:56

Keeping in contact with workers on site can be the difference between life and death. Stephen Westley, director at Global Mobile Communications, explains how the right rugged mobile device can increase productivity and act as a tool for verifying lone worker safety

Free E-newsletter Sign-Up

Sign up for our free e-newsletter

Looking for a company or service?