Банкеръ Weekly

Briefs

INSURERS DEMAND LOWER TAXES

The taxes, paid by insurance companies to the Agency for Insurance Supervision should be redistributed, and part of them directed to a special fund. This was demanded by the members of the Association of Bulgarian Insurers during their first meeting with the new Head of the Agency Roumen Gulabinov on January 22.According to the managers of private insurance companies, the taxes are too high now, do not correspond to the real needs for maintenence of the budget organisation, and are not rationally used. The idea is that the remaining money should be spent for various needs of the companies - advertising and training, for example. The funds should be managed by the Association of Bulgarian Insurers. Currently, the taxes paid by the individual companies go to the budget and from there are distributed for maintenance of teh Agency. Mr Gulabinov has asked for some time to consider the proposal before expressing his opinion on it.The insurers have also insisted for a change of the companies' tax regime. They are presently taxed under the Corporate Income Taxation Act. The general insurance companies are paying a 7% tax on the aggregate premium income, and life insurers are paying 2 per cent. The demand is to reduce these taxes to 5% and 1.5%, respectively, with the motive that such rates would be in compliance with those, charges in the other European countries. The proposal was made after the insurers' demand for imposing taxes on their profits, and not on the premium proceeds (as is the case at present) was resolutely rebuffed by the Ministry of Finance. The insurance companies have also required a revocation of the additional tax (amounting to 4% of their proceeds) which they pay for the devlopment of the State Agriculture Fund.

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