The Office for National Statistics reported a public finance surplus, excluding banks, of 1.29 billion pounds ($2 billion) in July, nearly exactly as forecast in a Reuters poll.
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The surplus, minus the effect of bank bailouts, stood at £1.3 billion last month, lower than expected but still a reversal compared to borrowing of £100 million for the same period in 2014.
One of the biggest contributors was a major boost in the amount of income tax – total revenues were £18.5bn, the highest since 1997.
“If this trend persists over the remaining eight months of the fiscal year, this year’s deficit would be £67bn, about £2bn lower than the OBR forecast in the Summer Budget”.
Document revenue tax receipts helped the Authorities to publish its first July price range surplus in three years final month, placing the Chancellor on monitor to scale back Britain’s borrowing invoice at a quicker tempo than presently anticipated. That compares with 500 million pounds in the same month previous year .
Osborne has vowed to wipe out a deficit of nearly 5 percent of gross domestic product within the current five-year parliamentary term and run surpluses during “normal” times thereafter.
Underlying public sector net debt, at £1.51 trillion or 80.8% of GDP, was slightly down on June.
Osborne said the latest figures were testimony to the economic recovery but that the government would continue to work on cutting Britain’s deficit.
Samuel Tombs, senior UK economist at Capital Economics, said: ‘July’s UK public borrowing figures show that the public finances are now benefiting fully from the economic recovery’s strength’.
Finance minister George Osborne welcomed Friday’s official figures, which also showed July was the 12th successive month of falling year-to-date public sector net borrowing, excluding banks.
David Kern, chief economist at the British Chambers of Commerce, said Osborne could beat his deficit target for this year. But with debt over 80 per cent of GDP, the job is not done’.
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Before the recession, July had regularly seen a surplus, averaging £3 billion, thanks to corporation tax receipts, he added.
