collected by Her Majesty's Revenue and Customs (HMRC) in the United Kingdom was approximately 827.74 billion British pounds. Tax is by far the main
for the UK government, with income tax, value added tax (VAT) and National Insurance contributions being the three-largest taxation sources in terms of value. In recent years, the overall value of tax revenue collected has consistently fallen short of what is expected, resulting in a
Taxes on income and wealth
As mentioned, income tax is the largest source of income for the UK government and
as a share of gross domestic product (GDP) was 9.8 percent in 2022/23. Since 2000/01, the
value of income tax receipts has increased from approximately 105.18 billion pounds, to around 273.3 billion pounds by 2023/24. Due to the UK having a progressive tax system, whereby, people on higher incomes pay a higher tax rate than those on lower incomes, taxpayers are split into various
tax brackets. As of 2021/22, 9.63 million people who paid income tax earned between 20,000 and 29,999 pounds per year, while just 25,000 taxpayers had earnings of one million pounds or more. After income tax, the next direct tax which raised the highest revenue were
National Insurance contributions, which raised over 177.74 billion pounds in 2023/24.
Corporation tax, a direct tax on company profits also contributed a significant amount of revenue for the government, amounting to 88.3 billion pounds in 2023/24.
Taxes on goods and services
The second most significant tax revenue source for the government were revenues raised by
Value Added Tax (VAT), a tax levied on the sales of all goods and services in the UK. As of 2024, the standard VAT rate was 20 percent, as has been since 2011, although some goods and services are charged lower rates or are completely exempt. Further taxes on certain items, such as
fuels,
alcohol, and
tobacco are also significant revenue sources to the government. In 2022/23, for example, fuel duties raised approximately 24.8 billion pounds in revenue. Alcohol duties were also an important revenue source, with wine duties raising 4.6 billion pounds, spirit duties 4.16 billion, beer duties 3.64 billion, and cider duties 221 million pounds.
This text provides general information. Statista assumes no
liability for the information given being complete or correct.
Due to varying update cycles, statistics can display more up-to-date
data than referenced in the text.
