“Self-assessment tax receipts helped reduce monthly borrowing to £1.1bn in July, the lowest July borrowing for three years. However, the longer-term picture for public finances remains challenging, as spending pressures, especially the cost of servicing debt, continues to mount.
“While interest debt costs were below projections in today’s data, rising inflation points to increases in the cost of index linked borrowing later this year. Gilt yields have also risen through August.
“The coming Budget is likely to focus on addressing any potential shortfall against current fiscal targets, which we estimate at £26.2bn. However, the assessment of the shortfall crucially depends on changes to the OBR’s forecast.”
-ENDS-
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Notes to Editors:
About KPMG
KPMG LLP, a UK limited liability partnership, operates across the UK with approximately 17,000 partners and staff. The UK firm recorded a revenue of £2.99 billion in the year ended 30 September 2024.
KPMG is a global organisation of independent professional services firms providing Audit, Legal, Tax and Advisory services. It operates in 143 countries and territories with more than 275,000 partners and employees working in member firms around the world. Each KPMG firm is a legally distinct and separate entity and describes itself as such. KPMG International Limited is a private English company limited by guarantee. KPMG International Limited and its related entities do not provide services to clients.