Hard-pressed families and firms paid an extra £29.6 BILLION in taxes during Labour's first year in power thanks to frozen income tax thresholds and hike in stamp duty on second homes

By MARTIN BECKFORD, POLICY EDITOR Published: 22:00, 18 June 2026 | Updated: 22:09, 18 June 2026 Labour raked in almost £30billion more in taxes from hard-pressed families and businesses during its first year in power, it has been revealed. Official figures have shown that central government taxation revenue reached a staggering £863.6billion in 2024-25, up £29.6billionn (a 3.5 per cent rise) on the previous year. HM Treasury's coffers were swollen by a £23.2billion rise in income tax receipts, taking the total to £309.4billion, as more workers were dragged into higher tax bands thanks to thresholds remaining frozen. 'There were no significant changes to income tax rules in 2024-25, and the increase in receipts was due to fiscal drag,' the Whole of Government Accounts published on Thursday admitted. And the report said the 'most dramatic' increase in tax, soaring by 23.6 per cent, was in stamp duty. Buyers were forced to stump up an extra £3bn in the hated levy, taking the total take to £19.9bn, after Rachel Reeves increased the rate on second homes. 'This was due to increases in the Stamp Duty Land Tax (SDLT) surcharge for second residential homes, which was introduced halfway through the fiscal year.' There was also a £13billion increase in VAT take to £178.5billion, which the report put down to 'increased spending'. Chancellor Rachel Reeves' first Budget in October 2024 paved the way for the higher tax take revealed in the new Whole of Government Accounts  Businesses paid £89billion in corporation tax, fuel duty made the Chancellor £24.7billion and National Insurance Contributions fell slightly to £149.9billion. Meanwhile families and firms paid town halls £62.9billion in council tax and business rates. The figures will add to Labour's reputation for raising taxes, after it emerged that Cabinet minister Pat McFadden had privately told Peter Mandelson: 'Every meeting I have is: 'Who can we tax in order to pay benefits to others?' Tory party chairman Kevin Hollinrake said: 'Labour hiked taxes on hardworking families after perpetually promising they wouldn't. 'Now the Treasury is quietly pocketing billions through frozen income tax thresholds and rising stamp duty - a stealth tax raid on people already struggling to make ends meet. 'And while families pay more, Labour are pouring billions more into welfare for people who don't work. 'The Conservatives are the only party with a plan to get welfare under control, keep taxes down and scrap stamp duty on the family home.' Darwin Friend, research director at the TaxPayers' Alliance, added: 'Labour is milking hard-pressed taxpayers dry through frozen thresholds and the punishing stamp duty. 'This is taxation by stealth, dragging more workers into higher tax bands while making it even harder for families to move home. 'Ministers should stop treating taxpayers like cash machines and must unfreeze thresholds and abolish stamp duty.' The public spending watchdog said it could not sign off the accounts, for the third year running, because of failings in the auditing of local authority finances. The National Audit Office issued a 'disclaimed opinion' as submissions from 280 of the 317 councils in England were either unaudited or disclaimed. No comments have so far been submitted. Why not be the first to send us your thoughts, or debate this issue live on our message boards. By posting your comment you agree to our house rules. Do you want to automatically post your MailOnline comments to your Facebook Timeline? Your comment will be posted to MailOnline as usual. Do you want to automatically post your MailOnline comments to your Facebook Timeline? Your comment will be posted to MailOnline as usual We will automatically post your comment and a link to the news story to your Facebook timeline at the same time it is posted on MailOnline. To do this we will link your MailOnline account with your Facebook account. We’ll ask you to confirm this for your first post to Facebook. You can choose on each post whether you would like it to be posted to Facebook. Your details from Facebook will be used to provide you with tailored content, marketing and ads in line with our Privacy Policy.