Lower top tax rate brings its reward
The April monthly statistics published by HMRC today show a huge increase in income tax receipts over the last tax year, up £4.4bn, says Nimesh Shah, senior manager at London chartered accountants Blick Rothenberg LLP.
Nimesh added: “The largest contributor to the increase is pay as you earn receipts, with a staggering £3.1bn surge. The increase clearly shows that not only are more in people in work, but wages are also going up.”
Nimesh said that the income tax statistics were particularly impressive given that the 2013/14 tax year was the first full tax year of the 45% top rate of income tax, versus 50% in the previous year.
Nimesh continued: “The statistics for National Insurance further substantiate that more people are working, with receipts up nearly £4.8bn. Every new worker broadly contributes £3,800 in National Insurance on earnings up to around £40,000 and their employer pays 13.8% National Insurance on earnings above £7,700.
“Overall, all round tax take is up £18.5bn on the previous 12 months with higher employment and better wages making a significant contribution.”
