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| Darling's black hole |
A BLACK hole in the taxes collected from British businesses means the nation’s debt is growing by £5,700 A SECOND.
Chancellor Alistair Darling was desperately relying on a cash injection from corporation tax in July to balance the books.
But his hopes will be dashed when final figures on Thursday show a devastating plunge in tax receipts from companies crippled by the recession.
The bleak news means Britain is on track to rack up £180 billion in debt by the end of the year, equivalent to £5,700 a second.
And that means massive tax rises and spending cuts will be even harder to avoid in the future.
Tax expert Charlie Elphicke, of the Centre for Policy Studies think tank, said: “Borrowing like this is totally bonkers. It’s not just mortgaging our kids’ future it’s going to hold back our chances of a job or a pay rise. The Government is wrecking things for everyone.”
July’s tax haul was the Government’s last hope to bring the nation’s ravaged public finances back under control.
The Chancellor’s coffers usually enjoy a big cash injection in July as corporation tax rushes in.
But next week’s figures will show corporation tax has been devastated as business profits plunge.
Public sector net borrowing for July — the gap between the exchequer’s tax take and its spending — is expected to be just £300 million. This is a massive £4.7 billion down on last July, when the haul was £5 billion. Vicky Redwood, UK economist at forecasters Capital Economics, said: “The country’s finances remain dire.
“Traditionally in July the budget swings into surplus because it’s a key month for corporation tax receipts.
“But the recession has badly hit business profits and corporation tax receipts have fallen sharply.
“The pathetic tax take for July means borrowing will be far higher than the Chancellor’s forecasts, and could hit £200 billion by the end of the year.”
The debt run up by the Government this year would pay for an Emirates Stadium in every town in the UK. And the mind-boggling sums are enough to feed every single family in the country for the next three years.
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