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PHILIPPINES’ non-life insurers urged the Bureau of Internal
Revenue (BIR) to scrap new taxes so as to make insurance affordable
to majority of Filipinos, particularly the poor.
In a statement Sunday, the Philippine Insurers
and Reinsurers Association (PIRA) said the P15-documentary stamp tax
that the BIR is planning to impose on all certificates of insurance
would have a great effect on “micro insurance,” which is
low-cost insurance marketed to poor families.
“The industry sells accident insurance with
minimal amounts of cover for students and travelers and as Christmas
gift certificates. The premiums on these plans can be as little as
P10,” PIRA said.
PIRA, the umbrella organization of 92 non-life
insurance companies, added the idea of micro insurance is to extend
insurance cover to the poor and marginalized segments of the
population.
“We feel the BIR should adopt a more pro-poor
stand insofar as taxes on insurance are concerned,” the group
said.
PIRA has been trying to convince the BIR to
completely rethink its position on its Revenue Memorandum Circular (RMC)
30-2008, which introduces new taxes on the industry and excludes
business expenses from the list of tax deductibles.
In a meeting on August 4, the group said its
position to BIR Commissioner Lilian Hefti and the latter issued RMC
59-2008 last week to amend her initial order.
The new RMC added commissions and other fees to
the list of expenses of insurance companies. It also corrected the
12-percent value-added tax on health and accident insurance, pegging
it at 5 percent, and adjusted documentary stamp taxes on health and
life insurance.
“This will mean the consumer s will again have
to pay more. The timing is bad considering that all of us are
reeling from the increase in prices of basic commodities,” the
group said.
-- Chino S. Leyco
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