Government finances showed a significant surplus last month after an increase in tax receipts, but the figure missed the forecasts made by the tax guard dog.
The surplus – the difference between what the government spends and the tax it takes – was 15.4 billion pounds sterling in January, which is the highest level for the month that started records there is more than three decades.
However, the Office of Budget Liability (OBR), which monitors government spending plans and performance, predicted that the surplus would be higher at 20.5 billion pounds sterling.
The latest financial figures are at a key time for Chancellor Rachel Reeves, with anemic economic growth and an increase in inflation exerting pressure on her tax and expenditure plans.
The OBR will publish its latest prospects for the British economy and public finances on March 26, when it details which margin the chancellor has against its self-imposed tax rules.
Last October, the guard dog said that she had 9.9 billion pounds sterling in the margin. However, low economic growth and higher borrowing costs have weighed on this reduction room, which raises the question of whether Reeves will have to increase taxes or reduce expenses.
The government tends to take more taxes than it spends in January compared to other moments of the year due to the amount it receives in self-assessing taxes during the month.
