HMRC launches consultation on the operation of Insurance Premium Tax 06 Jun 2019HMRC has launched a new consultation on how the administration and collection of Insurance Premium Tax (IPT) can be 'modernised'. The consultation also aims to review the extent to which there are emerging practices leading to 'unfair tax outcomes'. HMRC has stressed that the consultation focuses on the operation of IPT, and does not, therefore, consider the current rates of IPT nor the current exemptions to IPT. HMRC's consultation document states: 'We have been made aware of business practices involving administration and arrangement fees which may be leading to unfair tax outcomes in the insurance industry. 'This involves the artificial manipulation of insurance and broker structures to create different tax outcomes. IPT is chargeable on the gross premiums, whereas fees are not subject to IPT or VAT.' HMRC proposes extending the scope of IPT to include administration fees, in order to 'align their treatment with commission'. The consultation document can be viewed here. The closing date for comments is 17 July 2019.