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Non-life insurance companies denied that the country’s insurance industry was remiss in paying the government P8 billion in taxes for the past five years.

In a statement, the Philippine Insurers and Reinsurers Association (PIRA) said their members were baffled by reports that both life and non-life insurers owed the government billions in unpaid taxes. PIRA represents the non-life insurance industry or insurers selling insurance products such as auto, fire, property insurance, and personal or accident.

“We follow a very strict process in payment of the different taxes that the government imposes on insurance policies,” Mario Valdes, general manager of PIRA said. “For example, we (non-life insurers) pay the 12 percent documentary stamp tax (DST) five working days after the end of each month, the expanded value-added tax (EVAT) and fire service tax within the first 20 days after the end of the month, and the local government tax, once a year as part of the fees paid for getting the mayor’s permit.”

Valdes noted that all of these payments are made to the Land Bank of the Philippines and all the receipts submitted to the Insurance Commission (IC) together with the annual statement on or before every April 30 so the company could renew its certificate of authority (CA) needed to continue operation.

He stressed that the mere fact that 93 non-life companies are still legally operating in the Philippines is enough proof that these companies are faithfully paying their tax duties to the government.

Valdes added that the strict procedure in the payment of taxes is designed to enable the IC to ensure that all taxes are paid on time or else corresponding penalties are levied.

Just the same, Valdes said PIRA is polling its members to verify how much taxes they actually paid in 2005 to 2006. The association promised to publicly announce the result of the survey.

“The non-life insurance association intends to work closely with the Insurance Commission and other government agencies to correct these allegations, which unfairly tax the industry already suffering from a heavy tax burden and increasingly tight regulatory impositions,” he said.        — Ted Torres