TORONTO, June 14, 2012 /CNW/ - Advocis, The Financial Advisors Association of Canada, expressed its disappointment today with the Manitoba government's decision to apply a seven per cent Retail Sales Tax (RST) on individual critical illness insurance (CI), disability insurance (DI) and corporate-owned insurance coverage for Manitobans.
"The move today by the Manitoba government will make critical illness and disability insurance more costly for consumers. While it will generate some short-term revenue, it will lead to more government expenditure on health care in the long term," said Greg Pollock, president and CEO of Advocis.
Governments are increasingly downloading burdens onto families and small businesses. Consumers purchase CI and DI coverage, both individually and through employment-based group plans, to protect themselves financially from risks that governments increasingly do not cover. Adding premium taxes to such coverage makes it more difficult for consumers and employers to fill the void.
"Without taking the appropriate time to consult with industry and policy-holders — average Manitoba families and small businesses — the government is moving ahead with little regard for the impact this budget bill will have," Pollock added.
In May, Advocis joined other industry stakeholders in engaging the Government of Manitoba following the 2012 budget announcement that the seven per cent RST would be imposed on insurance premiums. The government initially announced that the tax would apply to property and casualty, group life, trip cancellation, baggage and land titles insurance, and that it would not apply to health and disability insurance.
Following the expansion of the RST scope to include CI, DI and corporate-owned insurance, Advocis urged Manitoba's Minister of Finance to remove these additional types of insurance from the budget legislation and to allow appropriate consultation and consideration of the impact such measures will have on Manitobans.
Advocis, The Financial Advisors Association of Canada, is the association of choice for financial advisors and planners. With more than 11,000 members across the country, Advocis is the definitive voice of the profession, advocating for professionalism and consumer protection. Professional financial advisors and planners are critical to the economy, helping consumers make sound financial decisions that ultimately lead to greater financial stability and independence. Advocis works with decision-makers and the public, stressing the value of financial advice and striving for an environment in which all Canadians have access to the advice they need.
For further information:
Media inquiries contact:
Kristin Doucet, Director of Communications (416) 342-9896 / 1-800-563-5822, ext. 9896