Data from HMRC has shown rising revenue, as Britons reckon with higher tax bills. However, the news is likely to be “music to the ears” of the new Chancellor Jeremy Hunt, an expert has argued.
Shaun Moore, tax and financial planning expert at Quilter, said: “The latest HMRC data shows receipts from income tax and National Insurance payments from April to September 2022 were £190.4billion.
“This is £24.6billion higher than in the same period a year earlier.
“This will no doubt be good news for the current Chancellor who recently kickstarted a renewed tilt to austerity as he looks to shore up government spending plans ahead of the OBR forecast on October 31.
“This increase likely reflects the uptick seen in average earnings over the past few months.
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Mr Hunt planned to reverse “almost all” of the mini-Budget’s tax cuts, in an effort to soothe markets and rebalance the economy.
He said he would scale back the energy support first announced as a two-year measure to just six months, ending in April 2023 for most people.
Mr Hunt hoped the move would reduce the pressures on the Bank of England to raise interest rates, and on the Treasury to slash public spending.
Other measures announced in the mini-budget which are set to be axed include:
- Cuts to dividend tax rates
- The reversal of IR35 working reforms of 2018 and 2021
- Freeze on alcohol duty rates
- VAT-free shopping for international tourists.
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However, whether his plans will come to fruition is unclear due to the resignation of Liz Truss yesterday.
Figures released today show HMRC raked in another £3.5billion in inheritance tax receipts in the six months to September 2022.
This was found to be £400million more than in the same period last year, continuing the upward trend.
Mr Moore added: “Elsewhere the data shows that the tax take from inheritance tax marches ever higher as house prices continue to grow.
“IHT is steadily becoming rather lucrative for the Treasury, with IHT receipts for April to September 2022 up to £3.5billion.
“This is an increase of £0.4billion compared to the same period a year earlier.
“IHT was once viewed as a tax on wealthier individuals, but the reality is that more people are now getting caught in the IHT net – partly as a result of soaring property prices.
“The nil rate band and the residence nil rate band will remain frozen until 2026, meaning more and more people, including many families that might not consider themselves to be wealthy, could now face a hefty IHT bill due to amount their properties have increased in value.”
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