Economic Reporter :
Bangladesh Insurance Association (BIA) has demanded withdrawal of 15 percent VAT on the insurance agent commission in the budget for fiscal year 2018-19 (FY19) for the expansion of insurance industry.
“There is 15 percent VAT at source on agent commission that has been affecting the insurance industry . . . this VAT should be withdrawn for the expansion of insurance business,” said BIA president Sheikh Kabir Hossain at a press conference on Monday.
He said the commission agents get from insurance companies is their income and they pay 5 percent tax on it. But if 15pc VAT is imposed on their income again it is equivalent to double tax, he added.
Hossain also said all listed companies are paying corporate tax at a rate of 25 percent but the listed insurance companies are paying corporate tax at a rate of 40 percent. He demanded reduction of the corporate tax for the listed insurance companies.
Terming the imposition of VAT on the premium of re-insurance as illogical, he said insurance companies collect 15 percent VAT while receive premium from clients and deposit it in the government exchequer and a part of this premium is given to the re-insurers. So, there is no scope to impose VAT on the premium of re-insurance, he added.
He also demanded withdrawal of 5 percent gain tax from the policy bonus of life insurance policy-holders.
BIA vice-president Dr Rubina Hamid and BIA leaders Monirul Haque, Mozaffar Hossain Paltu and Manzur Alam, among others, were present at the press conference.
