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Pensions must be exempted from financial transaction tax

Insurance Europe has written to the ambassadors of 10-member states* to reiterate concerns about the proposed financial transaction tax (FTT), in particular the need for all pension products to be exempted from the FTT.

Without such an exemption, the costs of the FTT will push up insurers’ expenses and diminish investment returns for policyholders, particularly those with insurance pension products that provide long-term retirement income and protection against an unforeseen life event.

EU insurers believe that the FTT should not discourage long-term savings, especially those associated with risk coverage. Doing so would be particularly inappropriate at a time when efforts are being made at both EU and national level to encourage financial protection for old age in response to demographic changes.

Imposing an additional tax burden on retirement and other long-term insurance savings products is also inconsistent with the objective and efforts of member states to increase the role of complementary retirement savings plans in pension systems in response to demographic changes.

*Belgium, Germany,  Greece, Spain, France, Italy, Austria, Portugal, Slovenia and Slovakia

 

Published 25 July 2019