The estimated overall spending on tax reliefs increased to a record £155 billion in the last financial year (2017-18), according to Resolution Foundation analysis of the annual HMRC Principal Tax Relief Statistics published today (23 JNUry 2018).
Adam Corlett, Senior Economic Analyst at the Resolution Foundation, said, “Spending on tax reliefs has grown to a record £155 billion a year and is now bigger than the combined budgets of the health, transport, justice, home and foreign office departments.
“While many tax reliefs exist for good reasons, others are poorly directed and none are scrutinised properly. As a result their cost is growing without any proper consideration of whether they provide sufficient public benefit.
“On a day when the Cabinet is discussing NHS spending pressures, and when low and middle income households are having their living standards squeezed by ongoing benefit cuts, policy makers must scrutinise these tax reliefs more closely in case there are better ways to spend any of this £155 billion.”
The estimated £155 billion cost of tax reliefs in 2017/18 is equivalent to total departmental spending on health, transport, justice, the home office and FCO combined. It is also equivalent to the revenue raised by corporation tax, council tax, fuel duty, stamp duty land tax and business rates combined.
* Resolution Foundation http://www.resolutionfoundation.org/
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