Treasury's April tax revenue rises to £11.5bn

The Treasury's income tax take for April has rocketed to £11.5bn - up from £10.2bn in the same period the year before.

The latest figures put paid to speculation that the already strained government revenue streams would be further hit by the Chancellor's decision to lower the 45p rate - a move that Labour dubbed a 'millionaire's tax cut'.

Yet while the Conservatives said that the 50p rate introduced by Gordon Brown in 2010 had not led to any significant increase in funds flowing into the Treasury and had reduced the UK's competitiveness, Stephen Herring, partner at BDO, said the figures would come as 'no surprise to the Treasury'

Herring said: 'The Treasury knows all about forestalling and anti-forestalling measures. It's like fuel duty going up and people filling up their car before midnight'And he stressed that many companies would have changed the month they paid out employee bonuses to benefit from the lower tax rate.

'It's not really tax avoidance, it's just part of pretty routine planning taking note of tax at the margins.'

Early predictions from HMRC pointed to the 45p rate costing the Treasury around £100m.

But Herring reserved particular ire for the stealthy entrapment of millions more tax payers into the higher rate tax bracket.

Following the March 2013 budget, another 400,000 will be caught in the 40% tax threshold of £41,865 in 2014/15, effectively one in five taxpayers. This equates to 4.2m in that bracket despite a 1% increase in the allowance. Over the past 10 years, this number has skyrocketed from 2.8m in 2000/01 to 4.2m in 2014/15, a 33% increase.

Herring said: 'More and more people are being sucked into higher rate tax bracket. No one should pay higher rate tax unless they are paid twice the median salary of £26,500 - some £53,000. But now higher rate tax kicks in at £44,000. It's ridiculous.'He branded the situation - started by former Labour chancellor Alistair Darling and continued by Osborne- as 'a hugely problematic anomaly affecting this middle caucus that needs to be fixed'.

'If you are on £45,000 in London you don't feel like you should be on the higher rate.'

The latest Treasury figures also revealed that corporation tax fell by 5.3% from £5.2bn in April 2012 to £4.9bn this year, while VAT increased to £9.4bn from £9.1bn over the same period.

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