The Commissioner of Insurance and helmsman, National Insurance Commission, Mr O S Thomas, in a move to show how far the insurance sector has leaped from anti-development laws to the enactment of enabling legislation, was upbeat that the stringent tax laws is now a shred.
Thomas, without mincing words said, “the previous tax laws were quite stringent on insurance operators,” and he explained how the operations of the sector was marred until they were repealed.
One of the drawbacks of the previous tax laws, he stated, was that the moribund laws, “permitted double taxation by taxing investment income and policyholders’ funds.”
While explaining further the manner these laws crashed into insurance in a goodwill message to Insurance Brokers CEO Retreat 2020, NAICOM CEO said these laws “allowed tax losses to be carried forward only for a maximum of 4 years of assessment contrary to what was obtainable in other businesses.”
Also stringent he said, was that “tax deductible claims and other outgoings were limited to 25% of total premium for general business, in contrast to what was obtainable in other businesses.”
Besides, he said it did not allow a full tax deduction on unexpired risk provision in relation to the financial year,