TAX receipts remained exceptionally buoyant in February, according to the latest official figures. They show that total tax revenues were £1.98 billion in the first two months of the year, some 22 per cent ahead of the same period last year. While the figures were boosted by a carry-over of VAT tax revenues from last year, the underlying growth rate remains strong.

Overall Exchequer borrowing in the first two months of the year was just £205 million, down from £603 million in the same period last year.

The strong increase in tax revenues appears to confirm that the economy is continuing to grow very strongly in the early months of 1997, leading to a healthy trend in income tax revenues and also in spending-taxes.