Rebates to be offered to anyone who renewed their insurance after April 15
The Newfoundland and Labrador government has announced the legislative changes necessary to eliminate the province’s tax on automobile insurance.
Finance Minister Tom Osborne introduced the amendment to the Revenue Administration Act on Tuesday in the House of Assembly.
The amendment has yet to be passed, but Osborne said he expects that will happen hopefully by the end of June.
When passed, that means an end to the 13 per cent tax on auto insurance renewal statements.
“At that particular point the insurance companies can do what they need to do to act as expeditiously as possible in rebating their customers,” Osborne said.
“And once we find out what that dollar figure is from the insurance companies, we’ll rebate the insurance companies.”
Rebate retroactive to April 15
Anyone who paid for their renewal between the amendment’s passing and April 15, the day the Liberal government first announced the end of the tax, will be eligible for the rebate.
However, anyone who renewed their insurance before mid-April won’t see a change in their insurance until their next renewal date.
Osborne said the exact amount that the province will have to pay insurance companies for the rebates is unknown, and will rely on when the amendment passes.
“That’s a moving target, the time that rebates start or that this becomes official, because the moment it becomes official and it’s law, insurance companies can stop charging the tax,” Osborne said.
“But every day there are further renewals … so we haven’t calculated that, but it’s about $57 million on an annual basis that the reduction in automobile sales tax will be for the province.”
Osborne said getting the changes to the bill through will mean there’s more time for all members in the House of Assembly to debate the Liberal budget.
“It takes pressure off of any timelines. We’ve agreed to provide whatever time is necessary to the members of the opposition and the third party and independent members to debate the budget as long as they wish, to whatever extent they wish,” Osborne said.
“This removes any time barriers. This interim supply measure will allow a debate to continue on into July if necessary.”