The Financial Times reported (30 March 2014) that the UK’s recovery is unusually light in revenues. According to the FT, the OBR originally hoped that the tax system would collect revenues worth 38.8% of national income in 2014/15, but the figure has been progressively revised down to 37%. This is not a reflection of a weakness in the economy as the figure is proportional to national income. This weakness in tax revenues may be explained by low corporation tax receipts from the financial sector, declining North Sea revenues and low pay growth hitting income tax revenues.
The Financial Times reported (30 March 2014) that the UK’s recovery is unusually light in revenues. According to the FT, the OBR originally hoped that the tax system would collect revenues worth 38.8% of national income in 2014/15, but the figure has been progressively revised down to 37%. This is not a reflection of a weakness in the economy as the figure is proportional to national income. This weakness in tax revenues may be explained by low corporation tax receipts from the financial sector, declining North Sea revenues and low pay growth hitting income tax revenues.
