Brits face ‘£19 billion worth of tax hikes’ for Chancellor to end austerity and balance the books
The Institute for Fiscal Studies said (IFS) the tax burden would rocket to the highest levels in since WWII if the Treasury was serious about wiping out deficit while pumping cash into public services
BRITS face £19 billion-worth of tax hikes if the Chancellor wants to end austerity AND balance the books, experts claim.
The Institute for Fiscal Studies said (IFS) the tax burden would rocket to the highest levels in since WWII if the Treasury was serious about wiping out deficit while pumping cash into public services.
A 1 per cent increase in tax on ALL income taxes, national insurance and VAT would raise £19 billion, the IFS noted.
But it warned this would be the “minimum” needed to claim austerity was over given over spending cuts yet to take effect.
Some £7 billion-worth of social security cuts have yet to “work their way through the system”, the IFS said.
The IFS said the Chancellor could raise £8 billion by reforming council taxes to reflect the higher property prices in the top four rate ‘bands’.
Mr Hammond could also tackle the “absurdly generous” tax breaks of pension pots passed on by OAPs under 75.
IFS chief Paul Johnson said the Chancellor’s tax and spend choices for the next spending review from 2020 would be the “biggest non-Brexit related decision this Chancellor will make”.
Mr Johnson said: “He has a big choice.
“He could end austerity, as the Prime Minister has suggested.
“But even on a limited definition of what that might mean would imply spending £19 billion a year more than currently planned by the end of the Parliament.
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“An increase of that size is highly unlikely to be compatible with his desire to get the deficit down towards zero.”
The blast came at the start of a two-week countdown to the Budget on October 29. The Chancellor has so far pledged to freeze fuel duty – and hinted he could tackle “eye wateringly” expensive tax breaks on pensions.
Economists claim borrowing this year might be around £5 billion lower than feared in the Spring. But they warn slowdown expected immediately after the EU Referendum is now happening.
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