Falling UK tax receipts

A critical factor in the ever deepening crisis (true cost of Monday's gamble now 35 billion according to this report in the Guardian) mentioned by A****** Darling in his 'Pre-budget report' as quoted by Hansard: I now want to turn to the forecast for the public finances. Because of the economic situation, tax revenues are falling across the world. As company profits fall, so do the proceeds from corporation tax. Receipts from the financial sector alone are expected to reduce by 35 per cent. this year. Slower growth in wages means less income tax. Fewer people buying houses and falling prices mean less money from stamp duty, where tax take is down 40 per cent. Because of the scale of these global problems, it is inevitable that tax revenues will take some years to come back up. That all means that borrowing will be significantly higher than forecast. Most commentators on the unfolding disaster this report summarises appear to have avoided comment on this factor, as the Finance Sector has come to represent such a large portion of UK tax receipts, is this 35 per cent fall realistic and what are the true implications if it is hopelessly optimistic as for most other estimates made by the present Government? Woolworths closing just ahead of Christmas as seems possible this morning will more than offset any positive feel for shoppers from a 2.5 per cent VAT cut purely designed to manipulate inflation figures!