The Office for Budget Responsibility (OBR) is forecasting that insurance premium tax (IPT) will now raise £57.8bn between 2025/26 and 2030/31, marking a £0.5 billion upgrade from estimates made following the Autumn Budget in November (£57bn).
This is according to OBR projections released today alongside today’s Spring Statement forecast.
Cara Spinks, head of life and health at independent financial services consultancy Broadstone, said: “While the chancellor spoke about tackling economic inactivity and supporting the NHS, she has missed a clear opportunity to do both by encouraging greater take‑up of private health insurance, in line with the recommendations of the Keep Britain Working review.
“Against a backdrop of sustained pressure on NHS capacity and stubbornly high waiting lists, claims under workplace health insurance continue to rise as employers increasingly look to PMI and health cash plans to support workforce productivity and retention. These products play a vital role in keeping people in work through earlier intervention, diagnosis and preventative care, while also easing pressure on the NHS.
“However, rising premiums risk constraining wider adoption. If the government is serious about reducing economic inactivity, cutting waiting lists and supporting growth, it must reassess the role of IPT in this market and consider targeted tax relief for these products.”