Analysis of the latest HMRC tax receipts showed employer national insurance contributions (NICs) hit £11.3bn in May, up £848m on the same month last year when the total was £10.66bn, marking an 8% rise in immediate tax costs for business.

The overall tax burden for business is on the upward trajectory, with corporation tax receipts alone up 12% to £3.31bn in May, compared with £2.96bn in 2025. When all business taxes are combined, including niche items like the diverted profits tax, energy profits levy and economic crime levy, the total for the first two months of the 2026-27 tax year was £8.6bn, up an eye watering 9.3% on the same period in 2025.

But it is not only businesses that are feeling the tax burden. PAYE employees paid £24.2bn in income tax alone in May, up 9% from £22.2bn just one year ago, undoubtedly caused by the impact of fiscal drag as more taxpayers are drawn into tax either for the first time or are being caught by the 40% tax rate.