“George Osborne’s commitment to further spending cuts along with changes to the personal allowance and 40p tax thresholds is welcome. Some of the Budget’s tax proposals will also undoubtedly help boost British enterprise, particularly announcements on business rate relief, corporation tax and tax cuts for the offshore oil and gas industry. It is also welcome that a new Lifetime Savings ISA will be introduced, which is very similar to the proposal from CPS Research Fellow Michael Johnson.
However, the Chancellor has unfortunately ducked some of the more major reforms needed. His announcement on tax simplification, for example, falls far short of what is required. As highlighted by CPS Research Fellow David Martin, the UK’s burdensome tax code has nearly doubled in length since 2010, and there is nothing in the Budget to reverse this worrying trend.
It is also concerning that the fiscal impact of this Budget is almost exclusively in the year 2019-20 – the year when George Osborne needs to achieve a budget surplus. Part of this is accounted for by the £3.5 billion of additional unspecified spending cuts, and it will be important to scrutinise the details of these cuts.”
Head of Economic Research
Date Added: Wednesday 16th March 2016