Tax receipts and national insurance contributions totalled £584.3 billion for the tax year 2020/21, £49.1bn lower than in the same period last year, Government figures show.

HMRC reported that VAT suffered the most, falling by £28.8bn (22%), attributable to the VAT payment deferment policy and the temporary reduced rate of 5% for hospitality, holiday accommodation and attractions.

Corporation tax takes fell by £11.4bn (17%) due the economic havoc the pandemic and lockdowns had on UK businesses.

Receipts were also lower for stamp taxes (19%), hydrocarbon oils (24%) and air passenger duty, which fell by a crushing 84%.

However, they were higher for inheritance tax (4%), alcohol duty (2%), and income tax, capital gains and national insurance contributions (1%).

Accounting for £352.1bn of receipts for 2020/21, HMRC said that the increased financial yield from income tax and national insurance "is most likely due to a combination of reduced economic activity leading to lower tax liabilities and deferral and non-payment of liabilities during the COVID-19 pandemic".

Talk to us about tax.


Subscribe To Our Newsletter

By submitting your details you agree to receive email marketing from EV Accountants and have read and understood our Privacy Notice. You can withdraw your consent or change your preferences at any time by emailing us or by clicking the link at the bottom of every email we send you.

You have Successfully Subscribed!