By JUDITH NAMUTOWE –
GOVERNMENT’S proposal to remove the Value Added Tax (VAT) on non-life insurance products will spur growth in the industry, Insurers Association of Zambia (IAZ) president Shipango Muteto has said.
The government proposes to remove VAT on non-life insurance products and instead introduce three per cent levy on insurance premium.
Mr Muteto said in an interview in Lusaka that his association was excited that the government had finally heard the members’ plea for the past five years.
“With regard to removal of VAT on non-life insurance products, we are very excited as IAZ because this will reduce the cost of insurance in Zambia,” Mr Muteto said.
Mr Muteto said that it was a step in the right direction for people buying insurance as that would reduce the cost.
He said this means that, people buying insurance policy would be doing so cheaply as they would only be required to pay three per cent levy on the premiums.
Mr Muteto said currently policy holders pay both the cost of premium and 16 per cent VAT.
“So for, we really salute government for finally listening to the industry and we believe that this will encourage a lot more Zambians to buy insurance, because it will now be affordable,” he said.
Mr Muteto also said the association expected that penetration levels in the country will increase.