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LedgerGov.UK

HMRC estimates · Direct effects of illustrative tax changes, published 24 Jun 2025

What a change to each tax raises

HMRC publishes what a small change to each tax would raise in a year. These are the changes most talked about before a Budget, one card each to quote and link to: HMRC's figure, the year it is for, the range we show, HMRC's caveat and a link that makes the change in the sandbox.

Of these one-point changes, 1 point on VAT raises the most, in 2026-27 and in 2028-29.

The cards

Each figure is HMRC's, for a change made at the start of 2026-27, on its own. The range is 10% either side, our usual band where a source gives none. A minus is a net loss: HMRC expects less tax, not more.

How these figures work

Where do these figures come from?

From HMRC's Direct effects of illustrative tax changes, the edition published 24 Jun 2025, the latest. HMRC works out what a small change to each tax would raise, for a change made at the start of 2026-27, using the official forecast of the time. The sandbox on this site uses the same figures.

Why is each figure shown with a range?

HMRC publishes one figure for each year. Anything forecast on this site is shown as a range, so we put 10% either side of HMRC's figure, our usual band where a source gives no range of its own. Quote HMRC's figure as HMRC's.

Can I double the figure for a 2p rise?

For most tax rates, yes, as a rough guide: HMRC says a 2p change raises or costs around twice as much as 1p. Not for capital gains tax, where HMRC says its figures cannot be scaled, so each card shows only the rises HMRC costs.

Do the figures allow for how people respond?

Mostly, yes. HMRC includes taxpayers' own responses where it models them, such as reporting less income or selling fewer assets. It leaves out wider effects on the economy, such as on prices, jobs or growth, which the Office for Budget Responsibility judges when a change is announced.

Is this what the Budget will raise?

No. These are HMRC's illustrations of a single change, made on their own. A real Budget measure is costed by the Treasury and checked by the Office for Budget Responsibility, and can differ, because it starts at another date, comes with other changes, or the forecast has moved.

Try any change, or several together, in the sandbox; see how the numbers are made.