Insurance Premium Tax (IPT) receipts in the UK reached £956 million in October 2024, a 24% increase compared to the £770 million collected in October 2023, according to the latest data from HM Revenue and Customs (HMRC).
The figures bring the total IPT revenue for the first seven months of the 2024/25 fiscal year to £5.5 billion, up 14% or £689 million compared to the same period last year, which recorded £4.8 billion.
HMRC data for September showed IPT receipts reaching £4.42 billion for the first five months of the 2024/25 fiscal year, a 13% rise from the £3.92 billion collected in the equivalent period the previous year.
In August alone, IPT receipts totalled £1.35 billion, marking an increase from the £1.16 billion collected in August 2023.
Despite the significant rise in IPT revenues, the tax was not addressed in the Chancellor’s October Autumn Budget. This omission has drawn comments from industry figures, including Cara Spinks (pictured), head of life & health at financial services consultancy Broadstone.
Spinks pointed to the pressure rising IPT costs place on private health insurance products, including health cash plans and private medical insurance.
“Health insurance products, such as health cash plans and private medical insurance, have seen increased pressure on premiums at a time when NHS challenges are driving employers to expand coverage of these healthcare benefits to support their employees’ health, and individuals look to the more efficient private healthcare market,” she said.
She noted that these pressures come at a time when challenges within the National Health Service (NHS) are driving employers to expand private healthcare coverage for their employees. Rising premiums, combined with the increased national insurance burden on employers, are making private healthcare less accessible to individuals and businesses.
Spinks said these factors risk limiting the preventative health benefits provided by private healthcare and its ability to complement the public system.
The NHS continues to face significant strain, with its waiting list standing at 7.57 million. Spinks urged the government to consider reducing IPT on health insurance products, arguing that such a move could promote preventative care, support the health of the UK workforce, and contribute to long-term economic growth.
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