VAT receipts in the UK 2000-2024

In 2023/24 VAT tax receipts in the United Kingdom amounted to 169.25 billion British pounds, compared with 159.75 in the previous financial year. Along with income tax and National Insurance contributions, VAT is one of the three-largest taxation sources for the UK government. Unlike income tax and national insurance, VAT is an indirect tax, and is raised via a 20 percent levy applied on most goods and services sold in the UK.

Tax revenue during the pandemic

VAT tax revenue took quite a significant hit during the COVID-19 pandemic, with receipts falling from 130 billion pounds in 2019/20 to 101.6 billion in 2020/21. The lockdowns enforced by the UK government clearly had an effect on consumer spending, but also impacted taxes associated with travel. Revenue from air passenger duties fell from 3.6 billion pounds to 585 million, while fuel duties fell from 27.6 billion to 20.9 billion.

How UK taxes are spent 

For the 2023/24 financial year, the UK government is expected to spend 341 billion pounds on social protection, which includes spending on housing benefits and pensions. After social protection, health had the next largest budget, at 245 billion pounds, followed by education at 131 billion. As of this year, the government was paying 116 billion pounds on debt interest, while defence spending was 68 billion pounds.