Insurance Council of Australia pushes for lower corporate tax rates

The council, instead, recommends creating a A$30.15b flood defence fund.

The Insurance Council of Australia (ICA) has rejected the proposed Net Cash Flow Tax (NCFT), warning it would be unworkable for insurers whose profits rise and fall with disaster cycles. 

It said the tax would raise costs for customers and urged governments to instead remove inefficient state insurance taxes such as stamp duties and the NSW Emergency Services Levy.

In submissions to five Productivity Commission reports, the ICA recommended lowering the corporate tax rate, creating a $19.97b (A$30.15b) flood defence fund, establishing a national climate risk database, and streamlining rules on artificial intelligence and data use. 

It also called for reforms to recognise existing skills and reduce licensing barriers to speed up recruitment, and backed investment in mental health prevention to lower absenteeism and claims.

Deputy CEO Kylie Macfarlane said disasters have cost $22.51b (A$34b) in claims since 2010, whilst regulatory burden wastes $45.03b (A$68b) annually. She warned the NCFT would undermine productivity by cutting funds available for investment.

($1.00= A$1.51)