European countries’ efforts to increase tax revenue may erode the tax advantages life products in those countries now enjoy.
Benjamin Serra and Tobias Moerschen, analysts in the European offices of Moody’s Investors Service, New York, come to that conclusion in a new comment on the competitiveness of traditional life products in Europe.
Life insurers are worrying about the possibility of Congress changing the status of life insurance policies, annuities and related products in the United States.
In Europe, the tax advantages that life products have enjoyed over mutual funds, bank products and individual pension products are already declining, or seem likely to decline in the near future, Serra says in a statement about the comment.
“As financially-stretched governments seek to raise fiscal revenues, the decrease in tax advantages for life insurance products will likely continue,” Serra says.