MNI DATA ANALYSIS: July Surplus Puts YTD Borrowing At 16Yr Low

--UK July borrowing -Stg2.008bn vs -Stg0.981bn July 2017 

--UK April-July borrowing down 40.0% over 2017 to Stg12.8 billion

By Jamie Satchi and Jai Lakhani

     LONDON (MNI) - The UK public finances swung into surplus in July, courtesy

of a strong influx of self-assessed income tax receipts.

     July borrowing, excluding the Bank of England, recorded a surplus of

Stg2.008 billion, the largest July net borrowing surplus for 18 years, compared

to a surplus of Stg0.981 billion one year earlier.

     Net debt fell to 75.2% of GDP in July, from 78.9% in the same month of

2017. That's the lowest net debt outturn since August 2012 (74.6%) and the

lowest July outturn since July of the same year (74.4%).

     Driving the month's performance was a marked increase rise in

self-assessment tax receipts. Receipts were stg9.0bn in July, up stg1bn from

last July, the highest level of July self-assessment income tax receipts on

record (records began in 1999)

     Accrued receipts are particularly high in the months of January and July,

though typically lower in the latter. This effect tends to roll into the

followiwng month so another helpful contribution may be at hand in August.

     --VAT RECIEPTS

     Value Added Tax receipts rose 2.4% to Stg12.1 billion last month while

income and capital gains taxes rose 7.2% to Stg21.3 billion in July

     Corporate tax also recorded a rise in July, up 3.2% on the year to Stg4.9

billion.

     Over the first four months of the fiscal year, borrowing fell by 40.0% over

the same period of 2017 to Stg12.8 billion, the lowest since 2002. That leaves

the government on track to meet the Office for Budget Responsibility's forecast

of a 6.0% drop in full-year borrowing to Stg37.1 billion, although the Treasury

may come under further pressure to loosen the purse strings as the fiscal year

unfolds.

     The central government net cash requirement fell to -Stg13.952 billion in

July, down from -Stg7.247 billion a year earlier.

     The current budget deficit fell to -Stg4.548 billion last month, from

-Stg4.190 billion a year earlier.

     Including the Bank of England, public sector borrowing fell to -Stg2.872

billion in July from -Stg1.845 billion last year.

--MNI London Bureau; tel: +44 203-586-2225; email: les.commons@marketnews.com

[TOPICS: MABDS$,M$B$$$,M$E$$$]