Chancellor Rachel Reeves should avoid “directionless tinkering and half-baked fixes” when trying to boost the government’s tax take in next month’s Budget, a leading think tank has said. Taxes are widely expected to go up in the Budget, with pressure on the chancellor to raise money in order to meet her self-imposed rules for government finances.However, the Institute for Fiscal Studies (IFS) – regarded as one of the UK’s most influential economic voices – has said some tax rises could be “especially economically harmful”.The Treasury said the chancellor had been clear the Budget would strike the right balance between funding public services, while also encouraging growth and investment.Some analysts have estimated that Reeves will have to raise tens of billions of pounds through either increasing taxes or cutting spending in order to meet her rules which she has described as “non-negotiable”.The two main rules are:Not to borrow to fund day-to-day public spending by the end of this parliamentTo get government debt falling as a share of national income by the end of this parliamentBefore the 2024 general election, Labour promised not to increase income tax, National Insurance or VAT for working people.The IFS said it would be possible for the chancellor to raise tens of billions of pounds a year more in revenue without breaking these manifesto promises, but this would not be straightforward.Its director Helen Miller told BBC’s Radio 4’s Today programme: “The politics is important and we’re going to hear lots …
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[mwai_chat context=”Let’s have a discussion about this article:nnChancellor Rachel Reeves should avoid “directionless tinkering and half-baked fixes” when trying to boost the government’s tax take in next month’s Budget, a leading think tank has said. Taxes are widely expected to go up in the Budget, with pressure on the chancellor to raise money in order to meet her self-imposed rules for government finances.However, the Institute for Fiscal Studies (IFS) – regarded as one of the UK’s most influential economic voices – has said some tax rises could be “especially economically harmful”.The Treasury said the chancellor had been clear the Budget would strike the right balance between funding public services, while also encouraging growth and investment.Some analysts have estimated that Reeves will have to raise tens of billions of pounds through either increasing taxes or cutting spending in order to meet her rules which she has described as “non-negotiable”.The two main rules are:Not to borrow to fund day-to-day public spending by the end of this parliamentTo get government debt falling as a share of national income by the end of this parliamentBefore the 2024 general election, Labour promised not to increase income tax, National Insurance or VAT for working people.The IFS said it would be possible for the chancellor to raise tens of billions of pounds a year more in revenue without breaking these manifesto promises, but this would not be straightforward.Its director Helen Miller told BBC’s Radio 4’s Today programme: “The politics is important and we’re going to hear lots …nnDiscussion:nn” ai_name=”RocketNews AI: ” start_sentence=”Can I tell you more about this article?” text_input_placeholder=”Type ‘Yes'”]
