Taxpayers have handed over an additional £8.6 billion in just two months as Rachel Reeves’s Budget begins to take effect, according to new figures from the tax office. Tax receipts for April and May reached £142.8 billion, marking a rise of over 6% compared to the same period last year.

Nearly three-quarters of this extra revenue came from income tax and National Insurance, with further increases seen in capital gains and inheritance tax receipts. In her first Budget last October, the Chancellor also raised employers’ National Insurance contributions from 13.8% to 15% and lowered the salary threshold for these contributions from £9,100 to £5,000. She also maintained the Conservative policy of freezing income tax thresholds – moves that came despite Labour’s manifesto pledge not to raise taxes on working people.

As a result, HM Revenue and Customs (HMRC) collected an extra £6.1 billion from these two measures alone over April and May, including £3.6 billion in additional income tax and £2.5 billion more in National Insurance contributions.

Tax experts warn that these so-called “stealth taxes”- freezing thresholds and reducing allowances – are pulling more people into higher tax brackets, even if their pay rises only modestly and fails to keep pace with inflation.

Quilter’s Rachel Griffin said: “Despite no new headline tax rises, receipts continue to climb thanks to frozen thresholds and slashed allowances. With income tax thresholds still frozen, many workers are paying a larger share of their earnings in tax simply due to modest pay rises, even when those increases fail to match inflation.”

Sarah Coles, head of personal finance at Hargreaves Lansdown, highlighted that income tax receipts typically dip in May after an April spike at the start of the new tax year, with this year’s income tax falling 29% from April to £21.2 billion. However, receipts are still up 6% from May 2024, “thanks to the horrors of fiscal drag pushing more people over tax thresholds, and hiking tax bills for millions of people.”

Ms Coles warned that the freeze on thresholds until 2028 means “there’s yet more tax pain to come,” and advised taxpayers to use ISAs and pensions to mitigate their tax bills.

She added: “It has appealed to Governments, because it’s not technically a tax rise, so it doesn’t break manifesto promises. However, these figures show just how lucrative it can be for the taxman.”