VAT Receipts up 4.8% to £34.5 billion in Q1 2019

Total VAT receipts for Q1 2019 were £34.5 billion, 4.8% higher than the same quarter last year.
Net home VAT receipts were £26.1bn which is £348m 1.3% higher than Q1 2018, while Import VAT receipts were up 17.3% to £8.3bn.
Home VAT payments and repayments were both higher than the previous two years, with Home VAT payments increasing by £2.2 billion against Q1 2018.
The increase in VAT coincides with the introduction of Making Tax Digital, with HMRC attempting to close the tax gap and reduce VAT fraud. Making Tax Digital is expected to improve VAT revenue by reducing the margin of error.
There were 70,000 registrations and 45,000 de-registrations in Q2 of 2018/19, giving an increase of 25,000 to the live trader population, which is now around 2.2 million.
Conversely, public borrowing hit £1.7 billion in March, up £0.8 billion in March 2018. There was, however, an improvement in the budget deficit for 2018/19 is an estimated £24.7 billion, which is higher than the OBR’s forecast of £22.8 billion.
There was an improvement in the budget deficit, which is at its lowest level in 17 years, since the financial year 2001/2. A reduction of £17 billion from March 2018 means that the deficit for 2018/19 is at £24.7 billion. However, this is higher than the OBR’s forecast of £22.8 billion.
Income tax revenues have increased, largely thanks to continued strong jobs growth and an increase in average earnings growth, despite overall GDP growth slowing.
Government debt as a percentage of national income fell for the second consecutive year, down to 83.1% of GDP from 84.6% of GDP.

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