Fears for Budget tax hikes as Government borrowing jumps unexpectedly to £1.8billion

MoneyNews Money Credit: Alamy Government borrowing unexpectedly jumped to £1.8bn last month, raising fears of tax hikes at the upcoming autumn Budget. New data from the Office for National Statistics (ONS) shows government borrowing was up £700m in July compared to the same time last year, a rise of 68.7%. The jump came as a shock after most economists had previously forecast zero borrowing last month, while the ONS had predicted a £500m surplus. The hike in borrowing also came despite the government raking in record amounts of income tax in July. Sign up for the Money newsletter Thank you! New chancellor John Healey will have to make decisions about spending and tax at the Budget in October, and rises in government debt will increase fears tax rises could be on the cards to repair the public finances. Mr Healey said: “Fiscal discipline is the bedrock of our UK economic stability and national security, which is why we are committed to meeting our fiscal rules, with a buffer against global uncertainties.” “We are cutting the deficit faster than any other G7 economy, while giving people a bit of breathing space with cost of living pressures and focusing support to get young people into work.” Income tax and National Insurance receipts came in at £173.2bn in the three months from April to July , which is £12.5bn more than the same period last year. Comment now