Tax receipts and national insurance contributions totalled £584.3 billion for the tax year 2020/21, £49.1bn lower than in the same period last year, Government figures show.
HMRC reported that VAT suffered the most, falling by £28.8bn (22%), attributable to the VAT payment deferment policy and the temporary reduced rate of 5% for hospitality, holiday accommodation and attractions.
Corporation tax takes fell by £11.4bn (17%) due the economic havoc the pandemic and lockdowns had on UK businesses.
Receipts were also lower for stamp taxes (19%), hydrocarbon oils (24%) and air passenger duty, which fell by a crushing 84%.
However, they were higher for inheritance tax (4%), alcohol duty (2%), and income tax, capital gains and national insurance contributions (1%).
Accounting for £352.1bn of receipts for 2020/21, HMRC said that the increased financial yield from income tax and national insurance "is most likely due to a combination of reduced economic activity leading to lower tax liabilities and deferral and non-payment of liabilities during the COVID-19 pandemic".
Talk to us about tax.
