Insurance Premium Tax (IPT) generated £1.3bn for the Treasury in August, according to the latest HMRC figures, a slight dip from the £1.35bn collected in the same month last year.
Receipts for the first five months of the financial year have nonetheless risen to £4.5bn, up £72m on the £4.24bn collected over the same period in 2024, underlining the growing importance of the levy to the Exchequer.
Analysts point to strong demand for private health insurance as a key driver, with more individuals and employers turning to cover amid mounting pressures on the NHS.
ANOTHER WINDFALL
Brett Hill, head of health and protection at Broadstone, said the data showed “another Insurance Premium Tax windfall for the Treasury as it continues to climb to record levels”.
He added: “Over the last few years, we have seen employers substantially widen their coverage of products like PMI and health cash plans to meet rising demand and support staff, combat absenteeism and sustain productivity.
“But this trend carries consequences – rising claims and more complex, expensive treatments due to delayed care are already pushing premiums higher, putting pressure on affordability for individuals and businesses.”
Hill warned that the government should resist any move to increase the levy in the Autumn Budget, set for 26 November.
He said: “If the government wants to boost growth and ease the strain on the NHS, it must resist any hike to Insurance Premium Tax as it looks for revenue raising measures to fill its fiscal gap.”
