Should the EU Adopt the Kiwi Approach for Taxing General Insurance Transactions?

Abstract: This thesis primarily concerns the European Union (EU) value added tax (VAT) exemption for insurance transactions. Due to the negative consequences that exemptions have on the proper functioning of the VAT system and those subject to it, this thesis explores the possibility of adopting the Kiwi taxed approach for insurance transactions. In order to do this, the provisions and functioning of both the EU exemption and the Kiwi taxed system are analysed and compared. A discussion of how the Kiwi taxed system could alleviate the problems associated with the exemption is presented, alongside any complications and problems that are currently incorporated in the Kiwi system itself. In addition to the legal issues, practical difficulties that could arise in reality are also presented, as these are very relevant for a discussion on implementing a system change. A conclusion is reached whereby the Kiwi system is put forward as a preferential model to be used in the EU, as it alleviates many of the core problems associated with the EU exemption. However, it is submitted that the Kiwi system should not be blindly followed and replicated in its entirety, but rather that the EU should take the opportunity to advance a taxed system which learns from and overcomes the problems of the Kiwi system.