Statistics released today show the total HMRC receipts for the year to September 2024 are up to over £840.1bn from £814.5bn collected in the year to September 2023, a 3.15% increase over the period. Income tax receipts account for more than half of this increase, with the annual receipts up 8.6% in the last 12 months, equating to £22.6bn more in the Treasury's coffers.
The main cause of the income tax increase is fiscal drag which continues to bring more people into higher rates of tax. This has been created by wage rises over the past 12 months and the freezing of the personal allowances and tax bands.
For the majority of taxpayers, these taxes are unlikely to ever affect them. Those who pay IHT only account for only 4% of the population. The total tax take of both IHT and CGT is less than the increase in income tax receipts over the last year.
Increasing the rates of tax on either of these taxes is not going to make a huge contribution. If you compare this to the National Insurance Contribution (NIC) receipts which are £174.8bn for the last 12 months, itself down £2.8bn compared to the prior year's take.
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