UK January Surplus Hits Record £30.4 Billion

The United Kingdom recorded its highest monthly public sector net borrowing surplus on record in January, providing a financial uplift for Chancellor Rachel Reeves as she prepares for her Spring Statement next month. Official figures from the Office for National Statistics showed a surplus of 30.4 billion pounds, the largest since monthly records began in 1993, when government revenues exceeded spending.

The surplus resulted from a combination of higher tax receipts and reduced debt interest payments. Central government tax revenues rose by 13.3 billion pounds to 109.7 billion pounds, driven by a surge in self-assessment income tax payments, which increased by 3.6 billion pounds to 29.4 billion pounds. Capital gains tax receipts also jumped by 7 billion pounds to 17 billion pounds, the highest January figure ever, linked to asset disposals ahead of rate increases announced in Reeves's October 2024 budget. Those changes raised the lower capital gains tax rate from 10 percent to 18 percent and the higher rate from 20 percent to 24 percent, effective immediately. Government spending fell slightly by 0.6 billion pounds to 86.1 billion pounds, aided by debt interest costs dropping 5...