LONDON (AP) — Britain borrowed 17.9 billion pounds ($27.9 billion) in May, official figures showed Tuesday — a much higher figure than the market expected and likely to raise questions about whether the government can achieve its full-year target.
The market consensus had been that borrowing would be 14 billion pounds.
The Office for National Statistics said that a 7 percent drop in income tax receipts and a 12 percent rise in welfare benefits from a year earlier were key factors in the increase. The statistics agency said total government spending was 7.9 percent higher in May, while total tax receipts rose by 1.6 percent.
Vicky Redwood, chief U.K. economist at Capital Economics, said weakness in tax receipts is the key problem and that "with the economy probably still in recession, receipts are likely to remain weak."
Amid the economic gloom, Treasury chief George Osborne gave motorists a break — and government coffers another hit — on Tuesday, announcing that he was postponing a planned 3 percent increase in fuel duty. Osborne deferred the increase until next year, a move expected to cost the government 500 million pounds.
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