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Oliver Sutton

Public Sector Borrowing Higher Than Expected

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Also last month's figures revised to a worse figure by £1bn.

Government borrowing remained high in August, hampering the chancellor's efforts to reduce the public deficit, official figures show.

The Office of National Statistics (ONS) said public sector net borrowing stood at £11.6bn last month.

Total borrowing for this year stands at £45.4bn, some 6.2% higher than at the same time a year earlier.

http://www.bbc.com/news/business-29324751

August continued this trend, with income tax receipts and social security payments growing just 1.6% from the previous year.

For the tax year so far, the amount has been 0.6% lower than in the same period a year earlier.

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Why is total income tax receipts lower than last year if unemployment has fallen so much?

Is it because lots of people are going "self-employed" to get tax credits but still earning nothing or very little?

Edited by Oliver Sutton

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Why is total income tax receipts lower than last year if unemployment has fallen so much?

Is it because lots of people are going "self-employed" to get tax credits but still earning nothing or very little?

Bank profits are significantly lower than 2013?

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Wouldn't that be corporation tax, although I suppose bonuses would be lower as well.

corporation tax is a miniscule amount.

I suspect as per above it's lots of self employed people gouging tax credits.

If I was a pollie, I wouldn't want to be winning the next election....

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So Osborne has just been incubating this deficit time bomb until the next parliament. Big cuts start next year? Or labour just pick up where he left off?

I'd personally loose the election then leave Labour to rot.

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corporation tax is a miniscule amount.

I suspect as per above it's lots of self employed people gouging tax credits.

If I was a pollie, I wouldn't want to be winning the next election....

Or self employed over 40s NOT getting any benefits, just cant be assed to drive into town every fortnight to be grilled by a tickboxer who demands 8 job applications a day.

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Is it because quite a few people are having to learn to live with less, people spending more on the items they need to live, and less on the little extras, is it because fewer people are smoking and driving/going out .....is it because the cost of moving is preventing more people moving and investing in upgrading their homes, is it because interest rates are so low less tax is collected on savings?......

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Wouldn't that be corporation tax, although I suppose bonuses would be lower as well.

The services of highly paid investment bankers/brokers might not have been retained.

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Is it because quite a few people are having to learn to live with less, people spending more on the items they need to live, and less on the little extras, is it because fewer people are smoking and driving/going out .....is it because the cost of moving is preventing more people moving and investing in upgrading their homes, is it because interest rates are so low less tax is collected on savings?......

Looks like tax on interest and dividends has nearly halved. Down £7.5bn.

VAT up by the rate of inflation so people still spending.

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Looks like tax on interest and dividends has nearly halved. Down £7.5bn.

VAT up by the rate of inflation so people still spending.

Must be the better off supporting the spending or more people spending less......but have to say increasing the personal tax allowance is the best thing they have done this term in government.

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Britain's debt interest bill leapt by more than a fifth to £4.2bn in August largely due to the accounting changes, while pension and other benefit payments increased to £0.2bn to £16.3bn in August.

Government capital spending also increased by 22.7pc to £22.3bn in August. Local government borrowing also increased by £0.1bn to £1.9bn.

Tax receipts are broadly lower this financial year, the ONS said, with income tax down £0.5bn to £60.4bn, though VAT receipts up 4.6pc to £51.4bn and corporation tax receipts are also higher.

The accounting changes also increased the size of Britain's debt pile to more than £1.43 trillion in August, 7.2pc higher than at the end of August 2013.

It's contained. ;)

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Why is total income tax receipts lower than last year if unemployment has fallen so much?

Is it because lots of people are going "self-employed" to get tax credits but still earning nothing or very little?

One reason is that last year was a bumper year for income tax due to it being the first year of the 45% top tax rate so lots of people had delayed paying tax in the year before to take advantage of the cut. About £10 billion extra income tax was received last year because of this.

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So when the Tories claim that the deficit has now been reduced to £80bn, presumably they are talking about the projection for this year? - which currently seems to be off target - although from past years I know it can turn around pretty quickly.

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