A decade prior in the 2015/16 financial year saw annual receipts at a significantly lower £3.29 billion – marking a 174% rise to current levels. Moreover, receipts have risen by 2.73 billion or 43% since five years ago (2020/2021 financial year) from £6.31 billion – highlighting just how lucrative IPT has become for the Treasury.
The Office for Budget Responsibility’s Spring Statement forecasts indicate that IPT is now expected to raise £57.8 billion between 2025/26 and 2030/31, marking a £500 million upgrade from estimates made after the Autumn Budget in November (£57.3 billion), as continued demand for health-related insurance products drive growth.
Cara Spinks, Head of Life & Health at Broadstone, commented: “Another record year for IPT receipts reflects how significant this tax has become for the public finances.
“Rising demand for health insurance, particularly private medical insurance, continues to be a key driver. Individuals and employers are increasingly looking for faster access to care against the backdrop of sustained pressure on the NHS. For employers, PMI plays an important role in supporting workforce health and participation – helping people access diagnosis and treatment more quickly and, in turn, return to work sooner.
“However, higher premiums combined with IPT are adding to cost pressures and risk limiting access at precisely the point demand is increasing. With IPT revenues expected to rise further, there is a strong case for Government to revisit how the tax applies to health insurance. A more nuanced approach, aligned with the objectives of the Keep Britain Working Review, could improve access to these products, support employers, and help relieve pressure on public services.”
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