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.