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Taxation

House of Lords written question – answered on 7th July 2011.

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Photo of Lord Skidelsky Lord Skidelsky Crossbench

To ask Her Majesty's Government what proportion of the United Kingdom total tax revenue is contributed by each of the five largest sectors of the United Kingdom economy; and what proportion of the United Kingdom total tax revenue is contributed by the financial sector.

Photo of Lord Sassoon Lord Sassoon The Commercial Secretary to the Treasury

HM Revenue Customs produce a breakdown by broad industrial sector for corporation tax, pay as you earn (PAYE) income tax and class 1 national insurance contributions (NICs) and value added tax (VAT).

Figures for corporation tax receipts paid by several broadly-defined business sectors are regularly updated and published in Table 11.1 on the HMRC National Statistics website. The sectors are defined by HMRC's Summary Trade Classifications. The latest update is available at http://www.hmrc.gov.uk/stats/corporate_tax/ tablel1_1.pdf

Total PAYE income tax and class 1 NICs received by HMRC between 1999-00 and 2010-11 in respect of employee and employer liabilities combined are shown split by sector in the table below.

Sector (£ billion) 99-00 00-01 01-02 02-03 03-04 04-05
Agriculture, Hunting and Forestry 664 630 598 617 676 730
Mining and Quarrying 701 762 675 673 654 669
Manufacturing 24,185 24,752 23,925 23,731 25,133 25,696
Electricity, Gas and Water Supply 1,225 1,229 1,118 1,089 1,098 1,135
Construction 6,981 7,597 8,200 8,974 10,164 10,751
Wholesale and Retail Trade 14,944 15,824 15,978 17,025 18,733 19,729
Hotels and Restaurants 2,314 2,457 2,558 2,806 3,200 3,450
Transport, Storage and Communication 8,779 9,801 10,139 10,104 10,912 11,939
Financial Intermediation 11,866 15,525 15,115 15,536 17,001 18,739
Real Estate, Renting and Business Activities 22,830 26,582 28,050 27,948 29,567 32,221
Public Administration and Defence 6,086 5,899 5,994 6,293 7,525 10,544
Education 11,441 12,442 13,206 14,105 16,274 17,498
Health and Social Work 8,648 9,035 9,659 10,845 12,959 14,598
Other Community, Social and Personal Service Activities 4,060 4,527 4,747 5,026 5,691 6,169
Occupational Pensions 5,989 6,300 6,561 6,671 6,752 7,166
Other 645 1,384 2,385 1,920 1,547 1,676
Total 131,358 144,748 148,905 153,363 167,887 182,709
Sector (£ billion) 05-06 06-07 07-08 08-09 09-10 10-11
Agriculture, Hunting and Forestry 765 782 839 865 858 882
Mining and Quarrying 757 829 864 961 982 1,039
Manufacturing 25,898 26,570 27,355 26,056 23,464 23,990
Electricity, Gas and Water Supply 1,135 1,253 1,429 1,519 1,514 1,565
Construction 11,575 12,428 14,236 13,779 11,896 11,665
Wholesale and Retail Trade 20,554 21,512 22,895 22,574 21,339 22,097
Hotels and Restaurants 3,640 3,891 4,046 3,857 3,732 3,864
Transport, Storage and Communication 12,676 12,826 13,125 13,062 12,289 12,255
Financial Intermediation 20,673 24,085 26,160 23,691 23,184 25,468
Real Estate, Renting and Business Activities 35,182 38,996 44,009 45,581 43,286 45,649
Public Administration and Defence 11,324 11,658 11,965 11,821 12,476 12,577
Education 18,456 19,422 20,133 20,487 20,747 20,837
Health and Social Work 16,167 17,454 17,735 18,385 19,530 20,340
Other Community, Social and Personal Service Activities 6,585 7,025 7,344 7,531 7,257 7,439
Occupational Pensions 7,609 8,402 9,195 9,449 10,058 10,644
Other 1,627 352 -43 70 -263 -282
Total 194,623 207,484 221,286 219,690 212,350 220,029

The sectors are defined by the Office for National Statistics' Standard Industrial Classification 2003. The occupational pensions figures include all income tax on occupational pensions, regardless of the sector in which the person was previously employed.

Declared VAT is published by trade group in the VAT factsheet, table 2.3 available at: https://www. uktradeinfo.com/index.cfm?task=factvat

Given that sectors for corporation tax, VAT, PAYE Income Tax and class 1 NICs are defined differently, these sets of figures are not directly comparable. For this reason, and also because sectoral breakdowns are not available for all taxes, it is not possible to say what proportion of total tax revenue is raised from different sectors, such as the financial sector, nor to say which of the sectors are the five largest contributing sectors.

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