Insurance Premium Tax: Motor Insurance
The question
To ask the Chancellor of the Exchequer, with reference to the RAC Report on Motoring 2025, published in October 2025, what assessment she has made of that report's recommendations on motor insurance tax.
Answered by Lucy Rigby
We have established a cross-government motor insurance taskforce with a strategic remit to set the direction for UK government policy, identifying short- and long-term actions for departments that may contribute to stabilising or reducing car insurance premiums. The taskforce's final report will be published in the autumn.
Insurance pricing is a decision which is affected by a wide range of factors, and the taxes that insurers pay are just one part of this. There is no guarantee that any reductions in Insurance Premium Tax (IPT) would be passed on to policy holders.
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