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Tax 3 of 8

Value Added Tax

Monthly

£14bn

Share of receipts

21.7%

Per household

£467

Per person

£206

Trend

+£3.1bn (28%) since 2019

Data sourcesHMRC — Tax receipts and National Insurance contributionsHMRC APIs (api.gov.uk)ONS — Public sector finances, UKONS Statistics API (api.gov.uk)
exact ONS/HMRC/MHCLG/PSS fields

How the rates work

  • Standard rate 20%

  • Reduced rate 5%

  • Zero rate

Everyone who shops — around 2.2 million VAT-registered businesses hand it to HMRC.

Inside the £14bn

Data sourcesHMRC — Tax receipts and National Insurance contributionsHMRC APIs (api.gov.uk)ONS — Public sector finances, UKONS Statistics API (api.gov.uk)
exact ONS/HMRC/MHCLG/PSS fields

Home VAT (domestic sales)

£10.6bn

75.7% · £353/household

  • Retail
  • Hospitality
  • Services

Import VAT

£2.9bn

20.7% · £97/household

  • Goods entering the UK
  • Postponed accounting

Other VAT

£0.5bn

3.6% · £17/household

  • Assessments
  • Penalties

VAT receipts collapsed in 2020 during the hospitality shutdown and the temporary 5% rate.

Businesses only register once turnover passes £90,000 a year.

Zero and reduced rates cost the Exchequer more than £70bn a year in forgone revenue.

Sources

Financial year 2024/25.