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Victoria removes life insurance stamp duty

The Victorian State Government has announced it will remove stamp duty on life insurance.
victoria remove life insurance stamp duty
The new measure, which will come into affect from the 1st of July 2014, is expected to save Victorian’s approximately $16 million over 4 years.

Historically, Victorians have paid 5% in stamp duty on life insurance which is a similar amount paid by the other states in Australia.

Life Insurance Type NSW ACT QLD VIC Tas SA WA NT Included in Base Premium
Life Insurance 5% 3% 5% 5% 5% 1.5% 0% 5% Yes
Accidental Death 5% 3% 5% 10% 10% 11% 10% 10% Additional Charge
TPD 9% 6% 7.5% 10% 10% 11% 10% 10% Additional Charge
Accidental TPD 9% 6% 7.5% 10% 10% 11% 10% 10% Additional Charge
Trauma 9% 6% 7.5% 10% 10% 11% 10% 10% Additional Charge
Income Protection and Business Expenses 5% 6% 7.5% 10% 10% 11% 10% 10% Additional Charge
Accidental Income Protection 5% 6% 7.5% 10% 10% 11% 10% 10% Additional Charge
Child Cover 5% 3% 5% 5% 5% 1.5% 0% 5% Yes

The 5% reduction in stamp duty would save the average $1,000 premium $50.00 per year.

John Brogden, CEO of the Financial Services Council (FSC) welcomes the changes and hoped other state governments would follow suit.

“The move by the Victorian Government and the ACT’s tax reforms in 2013, have shown that good process, some policy nous and courage can deliver.

“We hope other governments in Australia can follow this lead.”

About Russell Cain

Russell Cain(Can be on found on Google +) is the CEO of xLife Pty Ltd, an award winning life insurance comparison service which incorporates the Life Insurance Direct and xLife brands. He has over 10 years experience in the accounting and finance industry as well as over 15 years experience in running small business. It was in 2005 when running one of these small businesses that xLife first materialised as Russell realised the importance of sound financial advice, high level of customer service and the important of openness and transparency with customers. In his spare time, Russell is an avid property investor and home renovator, enjoys cycling and playing squash and also participates in an entrepreneurial mentoring program where he currently helps mentor small business owners to help achieve their goals.