Small Business and Tourism Minister Joe Hockey has joined the battle over high state taxes on premiums with a call to lessen the “prohibitive effect” on business. As the former Minister for Financial Services and Regulation, Mr Hockey is all too aware of just how tough it will be to make the states and territories get their hands out of the insurance till.

In Victoria, the insurers’ campaign to take on the state government over premium taxes – the highest in the world – took a bit of a high tackle from state Treasurer John Brumby last week. He made it very clear the state won’t budge on the issue of stamp duty, which has been reaping windfall profits through record property transactions and rocketing premiums.

Stamp duty in Australian states and territories is applied to property insurance on top of GST. Victoria, NSW and Tasmania also apply a fire services levy.

Despite the recently announced cuts in payroll and land taxes, Mr Brumby emphasised there will be no relief on stamp duty for property transactions or property insurance.

Last week Prime Minister John Howard joined the fray, criticising NSW and Victoria for making windfall profits from stamp duty. He said NSW is “swimming in cash” and Victoria is “rolling in the bucks”.

NIBA’s campaign to bring the premium taxes issue to the attention of brokers’ business clients, as well as the Victorian-based ICA campaign, will continue.