50% Off! Beat the market in 2025 with InvestingProCLAIM SALE

Government tax income climbs as inheritance receipts provide boost pre-Budget

Published 22/10/2024, 11:07
© Reuters.  Government tax income climbs as inheritance receipts provide boost pre-Budget

Proactive Investors - Government income from taxes grew over the first six months of the fiscal year, figures from HMRC showed on Tuesday.

Total gross tax receipts sat at £406.3 billion between April and September, marking an ​​£11.1 billion increase year on year.

This included growth from the likes of income, capital gains and business taxes, alongside stamp duty, VAT and national insurance contributions, HMRC said.

Inheritance tax receipts also increased, by £400 million to £4.3 billion, as speculation has built recently over hikes in next week’s Autumn Budget.

HMRC noted the increase had come after recent growth in asset values and previous government decisions to hold the tax-free threshold at £325,000 to 2028.

Rumours have swirled that chancellor Rachel Reeves will tweak inheritance tax rules in the October 30 Budget as she grapples to fill a £22 billion “black hole” in public finances.

“Inheritance tax is an absolute cash cow for [the government],” Wealth Club investment manager Nicholas Hyett commented.

“No one knows what changes will be announced, but most agree there will be some attempt to milk more revenue from estates.”

“The great thing about inheritance tax from the government’s point of view is that it’s complicated, with a whole host of rules that could be tweaked to boost the tax take.”

He noted this could include changes to make pensions subject to inheritance tax and extend the time needed to make gifts tax free.

This comes after separate figures on Tuesday showed government borrowing had increased last month to its third-highest level on record for September.

“If this Budget is going to ‘fix the foundations’ as ministers have briefed, then a number of those tax increases that have made it into newspaper print over the last few weeks will have to make it into the chancellor’s final draft,” AJBell analyst Danni Hewson added.

Read more on Proactive Investors UK

Disclaimer

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.