Record IPT receipts fuel calls to ‘cut’ tax to support growth

Insurance Premium Tax (IPT) receipts recorded a total of £2.17bn through the first quarter of the 2025/26 financial year.

The HMRC update, published on the 22 July, reveals an increase of £55m (2.6%) compared to the same period in 2024/25, which sat at £2.12bn.

Emily Jones, client consulting director at Broadstone, commented: “IPT receipts reached another record, £2.17bn, in the first quarter of the year, underlining that this tax is becoming an increasingly dependable cash cow for the Treasury.

“With a significant fiscal black hole to fill, any adjustment to the IPT rate or threshold seems unlikely.”

An ’unfair charge’

However, Shayne Halfpenny-Ray, head of policy and public affairs at Biba, said: “With record receipts for IPT, the evidence for an IPT cut grows stronger in order to cut cost pressures on businesses and individuals.

“Our research with WPI Economics showed that 63% of respondents believe IPT to be a tax on working people and it currently places a £4.7bn burden on businesses which is often passed on to customers.

“If the government is serious about growth, business confidence and supporting working people, they should cut IPT.”

An ABI spokesperson added: “Although we recognise the constraints on public finances, we maintain that IPT remains an unfair charge on a responsible purchase.

“Individuals and families who take steps to safeguard their wellbeing, livelihoods and loved ones should not be penalised for doing the right thing.

“That’s why we continue to urge for IPT to be frozen until economic conditions allow for a reduction in the standard rate.”