In October 2024 the chancellor of the exchequer, Rachel Reeves, delivered the first budget of the current Labour government. One of the less noted changes she announced was an increase in the interest rate on the late payment of taxes. The aim of this policy is to encourage the public... Read more...
Overview: In 2024-25, inheritance tax (IHT) is forecast to raise £8.3 billion. With the changes announced in the October 2024 budget, the revenue is expected to increase by 67 per cent, to £13.9 billion in 2029-30.[1] Inheritance tax is distortionary, unfair and deeply unpopular. The proportion of estates affected by... Read more...
Overview: Stonewall’s total income from government sources increased in 2023-24 to £618,757.[1] In 2022-23, it was £572,868. However, their overall financial position has worsened, with an increased deficit, redundancies[2] and lower revenue from fees (which includes the Diversity Champions scheme). In recent years, numerous current and former frontbench politicians have... Read more...
The first Saturday in January is the most popular day of the year to book a holiday,[1] but with UK travellers facing some of the highest taxes on air travel in the world,[2] going abroad may be more expensive than many expect. Air passenger duty (APD) is paid by passengers... Read more...
Christmas is a time for enjoyment with friends and family. Yet the holiday season is often also accompanied by additional pressure on household finances, as individuals plan to spend more than £650 on gift giving and making merry this Christmas. With the overall tax burden set to rise to record... Read more...
The national insurance contributions (NICs) measures in the October 2024 budget have been scored as one of the largest changes to a single tax for many decades. However, indirect effects mean the overall effect on the exchequer will be significantly lower than the headline figure suggests, as a higher tax... Read more...
Local authorities in England have multiple levels of governance. The layered and complex nature of local government creates confusion as to how council tax is charged and allocated across its many levels. Within a council tax bill, there can be differing council tax precepts attributed to the multiple layers of... Read more...
Key findings The cost of the Covid Inquiry is projected to be almost £208 million. This means the cost per day would amount to £144,939. The Covid Inquiry was formally established on 28 June 2022.[1] It is expected that witnesses will conclude giving evidence in June 2026.[2] The costs incurred... Read more...
Overview: Capital gains tax has increased substantially in recent years with an almost 50 per cent rise between 2019-20 and 2023-24 in receipts, increasing from £9.8 billion to £14.5 billion. Calls have recently been made for the introduction of an exit tax. Generally, this applies to the realised gains of... Read more...
In September 2024, chancellor Rachel Reeves promised “there would be no return to austerity” under the new Labour government,[1] echoing a promise made in the party’s election manifesto. Using data from the Office for Budget Responsibility (OBR),[2] this briefing note explores different definitions of austerity and calculates how much government... Read more...
Executive summary Wealth taxes are levied on personal capital, the stock of what people have versus the flow of their income or consumption. Within that broader category, net wealth taxes (annual charges on people’s net wealth) have been tried in many economies, but most have been scrapped. They are inefficient,... Read more...
The public sector has expanded steadily over recent years, with headcount currently at a record high. Given that public sector workers are paid more than their private sector counterparts and receive more generous pension benefits,[1],[2] this imposes a significant burden on the public finances. Yet the growth of the public... Read more...
The government spends approximately £22 billion a year to fund each cohort of undergraduates in England.[1] This consists of around £20 billion in tuition fee and maintenance loans, only 65 per cent of which is expected to be repaid in full,[2] as well as another £1 billion in teaching grants.[3]... Read more...
Local authorities own a wide range of non-residential properties, from shops and warehouses to schools and libraries. A 2020 report by the National Audit Office (NAO) found that this trend has grown, with local authorities spending £6.6 billion on commercial property from 2016-17 to 2018-19, 14.4 times more than the... Read more...
Overview: At 53p a litre, the UK has the highest duty on diesel and the ninth highest duty on petrol compared with EU member states.[1] This is higher than Belgium, over 23 per cent more than Spain, and almost double that paid by motorists in Malta. If the UK does... Read more...
Having promised not to raise taxes on “working people’’,[1] the government is widely expected to raise taxes on higher earners to pay for increased public spending. This comes as the UK is already set to lose more than 500,000, or 17 per cent, of its millionaires by 2028, one of... Read more...
The chancellor is set to present her budget for the next financial year in October.[1] Much attention will be paid to the spending and taxation changes announced, but alongside this, figures will be released by the Office for Budget Responsibility revealing the state of the public finances and the outlook... Read more...
Foreword For decades, successive governments have paid lip-service to the importance of keeping a handle on the public finances. Just as their constituents have to carefully manage their own budgets, monitoring carefully what comes in and how much they are spending, politicians know that they too are expected to treat... Read more...
Overview: At £2.35 per bottle of wine, the UK has the third highest wine duty of any country when compared with EU member states. 15 EU countries, in comparison, have no wine duty. Of the countries that charge alcohol duty on wine, France has the lowest at £0.03 per bottle.... Read more...
Under the current council tax system, individuals who live on their own receive a 25 per cent discount on their council tax bill.[1] This is applied to the total bill, after any precepts.[2] The discount also applies to households where all other members bar one are ‘disregarded’ – this includes... Read more...
In July 2024, the chancellor confirmed that the government would approve pay uplifts averaging 5.5 per cent for public sector workers.[1] This is more than double the rate of inflation, which was 2.3 per cent from April 2023 to April 2024,[2] and follows previous pay awards of five to seven... Read more...
One of the most significant services local authorities perform, and residents expect, is the collection of waste. However, the method and the complexity of the way that waste is collected differs from authority to authority. UK councils are required to run a service which collects recycling and garden waste separate... Read more...
Introduction In August 2023, the TaxPayers’ Alliance produced a research paper examining the growth of the civil service between 2016 and 2023. [1] It found that the number of civil servants grew by over 100,000 during that period, and that expansion had been top-heavy, London-centric, and tilted away from operational... Read more...
Debt interest is the cost the government pays on its borrowing. It mostly comprises interest paid on government bonds, which are financial products sold by the government to raise money. As public sector net debt continues to grow, reaching a record high of nearly £2.7 trillion in 2023-24,[1] spending on... Read more...