Massive tax black hole looms after Victoria bungles FSL transition.
Concern is growing among insurers that they may
be left to fund a massive shortfall in the Victorian fire services levy
(FSL) in 2012/13 after the State Government failed to ensure a smooth
transition from an insurance-based FSL to one funded through local
government rates.
The Baillieu Government plans to move from an insurance-based FSL to a
new property-based levy from July 1 next year, but has failed to reveal
details of how the transition – which will begin from July 1 this year
– will work.
Victoria’s fire levy phase-out debacle has tempers rising.
The end of a fire services levy (FSL) imposed on insurance policies in Victoria was supposed to be a good thing. Instead, it has turned into a nightmare that has seen the tax skyrocket, and is set to pit brokers against insurers before it is finally abolished on July 1 next year.
Due to capital investments in equipment and other improvements to the
state’s fire services recommended by the 2009 Victorian Bushfires Royal
Commission, the amount of FSL imposed on the insurance industry in
Victoria has risen to $641.9 million this current financial year, up 18%
on the $544.2 million raised in 2010/11.
That was itself a 30% rise on the previous year’s world record tax impost.
Comment: Mr Ryan, I hope this is not a beat up from the Insurance Companies!
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