The latest HMRC tax receipts data show Insurance Premium Tax collected a total of £2.1 billion through Q3 2023-24, a rise of 14% compared to Q3 2022-23 (£1.8 billion).
The tax has raised £6.1 billion through the three quarters of the financial year to-date, a 12% increase on the same period last year (£5.5 billion) and is expected to record yet another all-time high tax haul for the Treasury.
Cara Spinks, Head of Insurance Consulting at leading actuarial consultancy OAC, commented: “Many people will have noticed their insurance premiums rising over the past year or so as inflationary pressures increase cost for insurers across all sectors.
“While consumers are set to see another squeeze on their household finances, the Treasury looks set to haul in yet another bumper year of IPT receipts. Collections broke £6 billion in 2021/22, £7 billion in 2022/23 and could now surpass £8 billion through this financial year.
“Alongside rising costs, the health insurance sector has also experienced growing demand for its products. Increased pressure on the NHS has seen more employers and individuals take out private medical insurance and health cash plans to support continued health and speed up treatment.
“With the health of the nation and workforce at the heart of the government’s promise to drive up economic growth, the reduction or removal of IPT for health insurance products such as PMI and health cash plans could support this aim by reducing economic inactivity due to chronic illness while also easing the pressure on household finances.”
