UK Chancellor of the Exchequer George Osborne announced an increase in the insurance premium tax from 9.5% to 10%, and said that £700 million of the additional revenue would be used for flood prevention.
        Under current UK tax law, all underwritten insurance premiums in the UK are subject to the insurance premium tax, but lines such as reinsurance, life insurance, commercial aviation and marine insurance, goods in transit insurance in international trade and export insurance are exempt.
        The British Insurance Brokers' Association (BIBA) opposes the increase in the premium tax and questioned the rationale regarding flood prevention spending: "The premium tax is paid by insurance companies; it is a tax based on premium income from motor, household and commercial insurance. While we support additional spending on flood prevention, it could be funded from the £1.5 billion annual fund already committed,"

        Osborne had already raised the premium tax from 6% to 9.5% in September 2015. Premiums paid by insurance companies to captive insurers are also subject to the premium tax.