Businesses drive overall tax take up by £17.5bn
Businesses are leading the way to economic growth and prosperity in the UK with increased employment and better earnings says London Chartered Accountants Blick Rothenberg LLP.
The monthly statistics released by HMRC today show that the overall tax take for the last 12 months is almost £500bn. This is £17.5bn up compared to the previous 12 month period and represents an increase of 3.6%, which is ahead of inflation.
Nimesh Shah, partner at Blick Rothenberg, said: “All the taxes are contributing to the increase, including corporation tax, even though the main rate is now 3% lower than what it was two years ago.
“Businesses are the main driver behind increased employment, which has also lead to the increase in VAT collection via consumer spending on the back of higher earnings.”
VAT receipts are £7bn up compared to the previous 12 months and are the largest contributor to the total tax take increase. PAYE income tax and National Insurance (NI) receipts are also nearly £4.5bn higher than on the previous year.
Corporation tax is £1.2bn up and is at a similar level to what it was in 2011/12, despite the rate reduction, which is currently at 21% (and will be reduced to 20% from 1st April 2015).
Nimesh continued: “The increase in corporation tax (despite the rate cut) and higher VAT receipts suggests businesses are beginning to prosper and grow; and the increase in PAYE and NI receipts again suggests more people are in employment, which is possibly fuelled by increased business activity.”