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Strong employment boosts HMRC tax take and air passenger duty gets ready for take off

by jcp
gawdo
  • Income tax and national insurance receipts were £37.9bn, £6.5bn higher than this time last year. This reflects continued growth in the number of paid employees.
  • This growth has yet to incorporate the rise in national insurance contributions that came in in April.
  • Stamp duty taxes continued their strong growth – up £0.5bn since this time last year. This growth was due to the stamp duty holiday being in place this time last year.
  • Air passenger duty was up by £0.2bn on this time last year. This reflects an increase in people going on holiday but is still well below pre-pandemic levels.

HMRC has released the latest tax receipt data for April 2022

HMRC tax receipts and National Insurance contributions for the UK (Monthly Bulletin) – GOV.UK (www.gov.uk)

Helen Morrissey, senior pensions and retirement analyst at Hargreaves Lansdown:

“We continued to see the benefits of high employment levels with income tax and national insurance receipts continuing to rise reflecting a 4.9% boost in the number of paid employees. This is a hugely positive trend but there are darker clouds gathering on the horizon as we expect to see the impact of the 1.25 percentage point rise in National Insurance start to factor in the data in the coming months. As the cost-of-living crisis continues to bite it will be an extra cost many people can ill afford.

Stamp duty continued its strong growth – up a whopping £0.5bn on the same point last year. This is largely due to the stamp duty holiday that was in place last year which contributed to record receipts. However, it remains to be seen how much longer this performance can continue with rising interest rates pushing up buyers’ costs and soaring bills eating into affordability. The housing market has remained strong so far but could well start to run out of steam.

One tax that looks set for take-off is air passenger duty. Stuck in the doldrums through much of the pandemic we have seen it rise in recent months as the lifting of restrictions means more people are looking to jet off for a well-earned break. It is still well below pre-pandemic levels but is on the rise. We should expect it to continue to soar as summer approaches.”

www.gawdo.com

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