What's happened to UK tax receipts?

Having become accustomed to UK tax receipts rising faster than the economy was growing, last year brought a sharp jolt, as receipts declined for the first year since 1993. At Budget 2009, the Chancellor forecast that tax receipts would drop by 8% this year - from £505 billion to £465 billion.

Tax receipts rose by 6-7% to peak in 2007-08. Receipts then dropped by 2% last year and are predicted to drop by 8% this year. The Treasury hopes that growth in tax receipts will resume next year and thereafter continue on a rising path as GDP growth resumes. Measures announced at Budget 2009 and previously raise modest additonal amounts of tax in 2010-11, but much more significant tax increases (over £5 billion)are planned for 2011-12.