HMRC tax receipts data shows that Insurance Premium Tax collected a total of £1.5bn in February, taking the total collected through the first 11 months of the financial year to £8.1bn and setting a record annual total with one month of receipts still to come.

It marks the third successive year in a row that IPT has hauled in all-time high receipts, surpassing last year’s total of £7.3 billion.

Revenue from IPT is anticipated to rise even higher than expected over the coming years compared with just four months ago, increasing its forecasted revenues by over £370m between 2023-24 and 2028-29.

Cara Spinks, head of insurance consulting at consultancy OAC, commented: “With tax receipts still to be collected for one month of the financial year, IPT has nonetheless already exceeded all previous annual records.

“The bumper tax haul demonstrates both the importance of the tax to the Exchequer as well as the impact that rising insurance premiums are having on household budgets. Many will have felt the financial squeeze when renewing policies, which is adding to the increase in IPT receipts.

“It is disappointing therefore that, amid lengthening waiting times for NHS treatment, the Chancellor did not take the opportunity in the Spring Budget to reduce the level of IPT for private medical insurance. Demand for PMI is increasing, evidenced by an all-time high level of private health admissions reported just last week by PHIN.”

The British Insurance Brokers’ Association recently renewed its call for IPT exemptions for multi-occupancy buildings with fire safety issues – something it was disappointed to see omitted from the government’s Spring Budget.

Separately, the Association of British Insurers launched its own campaign to raise awareness of the fact that insurance premium tax affects 84% of households in the UK and has doubled to 12% since October 2015.

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