Changes to Quebec tax regime could increase cost of services provided by brokers

The Quebec Services Tax increased by 1% on Jan. 1, 2011, and although the QST is not charged on insurance premiums, it is charged on services that a broker may perform (such as engineering), Marsh reported.
In its report, Insurance Premium-Related Tax Update Q4 2010, Marsh noted the QST increased from 7.5% to 8.5% at the start of 2011.
It also noted Quebec’s government raised the compensation tax from 0.35% to 0.55% from Apr. 1, 2010 through Mar. 31, 2014, resulting in the unlicensed tax on property placements increasing from 3.35% to 3.55%, the report added.
“Currently, the unlicensed tax rate applies only to property insurance with unlicensed insurers,” it said.