OIC seeks new tax breaks

       The Insurance Commission has asked the Finance Ministry to increase tax deductions for three insurance categories to boost the industry's growth.
       Regulators recently completed a review of tax incentives offered against premium payments for different types of insurance, said Chantra Purnariksha,the secretary-general of the Office of the Insurance Commission (OIC).
       The commission will propose that individual tax deductions for life insurance premiums be doubled to up to 200,000 baht per year to encourage longterm saving, she said.
       Regulators will also propose that tax deductions for premium payments to investment-linked life insurance policies be doubled to up to 200,000 baht for the first year. From the third year of coverage,deductions should be made similar to tax incentives offered for contributions to long-term equity and retirement mutual funds, now set at up to 500,000 baht per year or 15% of income, whichever is lower.
       The Insurance Commission also proposes that premium payments for health insurance riders to life insurance policies also be made deductable.
       The Revenue Department currently disallows tax deductions for premiums paid to health insurance riders. Insurance regulators propose that premium payments of up to 50,000 baht per year for health coverage be made deductable from personal income tax.
       In any case, tax deductions should be permitted only for life insurance policies with terms of at least 10 years.
       Mrs Chantra said premium payments for life insurance currently amount to 300 billion baht per year, with another 100 billion paid for general insurance policies.
       The commission projects premium payments at 5% of GDP within two years,up from 3.9% this year.