Public finance boost for Osborne

Published: Friday 20th February 2015 by The News Editor

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George Osborne has received a boost in the last set of public finance figures before the Budget as bumper income tax receipts and a £3.6 billion revision helped him near his deficit target.

Public sector net finances – excluding the effect of bank bail-outs – were in surplus by £8.8 billion in January, up £2.3 billion from the surplus in the same month last year.

The Treasury is normally in the black in the first month of the year but the latest figures were boosted by record self-assessment income tax receipts of £12.3 billion.

It helped boost the Government’s surplus for the month to its highest figure since January 2008.

Borrowing for the fiscal year starting in April 2014 is now £74 billion, 6% lower than the same period last year.

It brings the figure into line with the annual fall in the deficit forecast by the independent Office for Budget Responsibility (OBR) after several months when it has been lagging behind.

This was also helped by a £3.6 billion revision for the public finances for April to December.

It included a £1.2 billion European Commission rebate to the UK after its contributions to the EC were increased – a rise accounted for in the previous month’s public finance figures.

Government departments also spent £1.5 billion less than had been expected while VAT and income tax receipts were higher than previously thought.

In January’s figures, income tax and capital gains tax saw a record month, up 6.1% to £26.7 billion.

Meanwhile stamp duty on land and property fell year-on-year for the first time since April 2012.

Receipts from this tax were 15% lower than in the same month last year at £700 million, but were still at a record high for the fiscal year-to-date at £9.5 billion.

Published: Friday 20th February 2015 by The News Editor

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