Travel insurance anomaly to be fixed

29/6/04
State Cabinet has decided to overhaul outdated stamp duty laws that could otherwise drive up international travel insurance premiums.
Treasurer Eric Ripper today announced the Government would amend the laws - backdated to July 1, 1997 - to remove an anomaly that would force people to pay extra stamp duty on their policies.
Mr Ripper said the amendment would be followed by a major rewrite of the 83-year-old Stamp Act as part of the Government's business tax reforms.
"We want fewer, fairer and simpler taxes to make doing business in Western Australia more efficient," he said.
"The Gallop Government inherited a dog's breakfast of tax arrangements that desperately needed reform.
"We have since abolished six nuisance taxes, modernised land tax and payroll tax, streamlined tax administration - and we will now tackle the outdated Stamp Act, starting with its insurance provisions."
Mr Ripper said the anomaly applied to international travel and other insurance policies involving risk outside Australia.
"The current law requires stamp duty to be applied to the total premium paid, including that part of the premium related to risk outside of Australia. It is an unintended consequence of the legislation that has the potential to drive up costs. It is also out of step with other States and Territories," he said.
Mr Ripper said the provisions to be amended had not been updated since 1979. Audit activity by the Office of State Revenue on six travel insurers based in WA found they were either not paying stamp duty or were applying stamp duty in several different ways, prompting a ruling by the Commissioner.
Any stamp duty overpaid since July 1, 1997 as a result of this anomaly will be refunded, subject to certain conditions.
Treasurer's office: 9222 8788