Budget costs young drivers an extra £40 a year
Commenting on the proposed increase in insurance premium tax from 6% to 9.5% in today’s Budget, Rod Jones, insurance expert at Uswitch.com, said: “The feared increase in fuel duty didn’t materialise, but it’s not all good news for motorists. Drivers could well be feeling like the Government has given with one hand and taken away with the other.
“Raising insurance premium tax is another kick in the teeth for young drivers, who are already struggling to pay sky high premiums without the advantage of a no claims discount. Drivers aged between 17 and 22 could now find themselves paying an average premium of £1,247 a year – an increase of almost £40 – before any other motoring bills have been paid. It’s high time a flat rate tax system was introduced.
“But it’s not just drivers who will see costs go up. The increase will hit home insurance policies too – with those living in non-standard properties or homes with a flood risk seeing the biggest rise.”
FOR MORE INFORMATION
Katherine Moss
Phone: 020 3021 5893
Email: katherine.moss@uswitch.com
Twitter: @uswitchPR
Notes to editors
1. Figures based on average insurance premiums from the AA British Insurance Premium Index. Average premium for 2015 Q1 was £530.47. Without the 6% tax this figure would be £500.44. With a 9.5% tax rate, this would increase to £547.99. Average premium for drivers aged 17-22 in 2015 Q1 was £1,207.61. Without the 6% tax this would be £1,139.25, and with the 9.5% tax this would increase to £1,247.48.
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