The HMRC has collected £37 billion in revenue from brand-new taxes that it has introduced over the last decade according to new research by UHY Hacker Young. The new taxes cost £7.6 billion in 2018/19, up from £7.4 billion n the previous year. The newest tax, the Soft Drinks Levy, has cost over £300 million in the year since it was introduced in April 2018. The three highest-yielding taxes that have been introduced by HMRC over the last ten years are
- TheApprenticeship Levy – a tax on businesses to ensure that they are funding new and existing apprenticeship schemes, generating £5.5bn since being introduced in 2017.
- The Bank Surcharge – an additional 8% tax on UK banks’ profits, generating £5.3bn since being introduced in 2016.
- The Bank Levy – a tax on UK banks requiring them to pay over and above normal corporation tax, generating £20.4bn since being introduced in 2011.
The research warns that the significant success of these new taxes could encourage HMRC to introduce more taxes in the future to try to increase its tax take.
There are also a number of new taxes either being introduced or mooted by the Government that would increase the tax burden on UK businesses. For example, there is mounting pressure on the Government to introduce a ‘sin tax’ on vaping products. The World Health Organisation is also encouraging the introduction of a ‘trans-fat’ tax that could result in an industry-wide levy on businesses that produce foods high in harmful fats.
Additionally, some analysts have also suggested that new taxes would be required to meet the Government’s pledge to reach net zero emissions by 2050.
Clive Gawthorpe, Tax Partner at UHY’s Manchester office, said “Adding new taxes and placing a heavier burden on businesses does not seem to fit in with the Government’s aims to simplify tax. These new taxes have already brought in billions of pounds in a relatively short space of time. If we want tax simplification shouldn’t we be reducing the number of taxes?”
“Each new tax adds more and more of a burden on businesses. Given the economic uncertainty perhaps the Government should be holding off on plans for new taxes.”
The taxes introduced in the last ten years Total value of tax yielded since being introduced
1 Bank Levy £20.4bn
2 Apprenticeship Levy £5.4bn
3 Bank Surcharge £5.2bn
4 Bank Payroll Tax £3.4bn
5 Swiss Capital Tax £957m
6 Annual Tax on Enveloped Dwellings £954m
7 Diverted Profits Tax £369m
8 Soft Drinks Industry Levy £318m