The tax rises announced in the October 2024 Budget – coming on
top of the big net tax raising measures announced over the
2019-2024 parliament – will push government revenues as a share
of national income up to record-high UK levels. This is not
uncommon in international comparison – revenues have been rising
in most other advanced economies over the 21st
century, with many now at, or near, their record highs. What is
specific for the UK is, in contrast to many other countries,
revenues were reduced sharply over the 1980s. Since then, the UK
has been catching up. For a Chancellor committed to keeping debt
from rising and avoiding a ‘return to austerity' in the form of
cuts to spending on public services then, absent stronger growth,
further tax rises may prove difficult to avoid.
Martin Mikloš, research economist at IFS and co-author of
the piece, said: “UK Government revenues are approaching
a record high. But the UK is not alone in this: many other
advanced economies have pushed their tax take to near-record
levels in recent years. Having fallen during the 1980s UK
revenues have been rising since the mid-1990s. On the latest
forecasts from the Office for Budget Responsibility revenues in
the UK will soon rise slightly above the average of our peers.
Given that our appetite for public spending appears to have
already matched that of other countries, we should not be
surprised if we need to tax as much too.”
READ THE BRIEFING
HERE
ENDS
Notes to Editors
The UK's near-record government revenues are not uncommon
internationally is an IFS briefing by Carl
Emmerson, Martin Mikloš and Isabel Stockton
