By Wiktor Szary and Jason Douglas
LONDON--The U.K. government ran a significantly smaller deficit in October than it did a year earlier, as revenue from taxes on production, including value-added tax, reached the highest level on record, official data showed Tuesday.
The Office for National Statistics said the U.K. government received GBP4.8 billion ($6 billion) less in revenue in October than it spent on public services. The deficit was GBP1.6 billion narrower compared with October last year, and smaller than expected by analysts polled by The Wall Street Journal, who put it at GBP6.0 billion.
The government's overall borrowing for the seven months of the fiscal year decreased by GBP5.6 billion compared with the same periodlast year, the ONS said, and stood at GBP48.6 billion. However, the ruling Conservatives remained on track to borrow more in the full financial year than had been anticipated, suggesting that Treasury chief Philip Hammond will have limited scope for any fiscal stimulus when he lays out his tax and spending plans later this week.
Mr. Hammond, who took over the role of Chancellor of the Exchequer after the June referendum, has already abandoned his predecessor George Osborne's goal of closing the U.K.'s budget deficit by the end of the current government's five-year term in 2020. The Conservative government has also said it would increase public spending on infrastructure.
But Mr. Hammond has also previously played down the prospect of a big fiscal boost, saying Britain's public finances were still "unhealthy" and the country should not be "cavalier" about its debt levels.
Write to Wiktor Szary at Wiktor.Szary@wsj.com and Jason Douglas atJason.Douglas@wsj.com
(END) Dow Jones Newswires
November 22, 2016 04:56 ET (09:56 GMT)
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