What can we expect from the 2021 budget?
The chancellor is set to outline a three-point plan to support people through what the government hopes will be the final months of coronavirus restrictions.
In his statement to the Commons on Wednesday, he will also announce further support for self-employed workers will also be announced, with around 600,000 people – many of whom became self-employed in 2019/20 – now eligible for cash grants.
Paul Johnson, director of the Institute for Fiscal Studies (IFS), said he was not expecting Chancellor Rishi Sunak to announce tax rises. “I expect, some tax rises, but not this year, in the next two or three years,” he told BBC Radio 4’s Today programme.
‘Tax rises, but not this year’ – IFS’ Paul Johnson
Paul Johnson, director of the Institute for Fiscal Studies (IFS), said he was not expecting Rishi Sunak to announce tax rises in the Budget. He told BBC Radio 4’s Today programme: “The bigger picture is that we’ve had the most awful, very deep recession with a huge amount of Government support, so in some senses it hasn’t felt like that.
“There are some suggestions and reports that the OBR’s (Office for Budget Responsibility) forecasts over the next few years are going to be rather more optimistic than they were back in November and if they are, if it looks like the economy has a good chance of bouncing back well, that will make some of his decisions a bit easier.
“Because remember what the chancellor is not really thinking about is ‘how can I pay back the debt that I’ve incurred over this couple of years?’.
“It is much more, ‘if the deficit remains big in the coming years, what do I need to do to plug that hole?’. And if the economy is bouncing back then there is less of a hole to plug.
“But there will still be something of a hole and that will mean, I expect, some tax rises, but not this year – in the next two or three years.”
Tom Batchelor3 March 2021 08:29
Rishi Sunak pours billions more into Covid support
Some of the main elements of the chancellor’s statement to the Commons this afternoon were trailed last night, including extension to the furlough and changes to mortgage deposits.
As our political editor writes, Rishi Sunak will say he is ready to do “whatever it takes” to help businesses and people through this “moment of crisis”, promising to use “the full measure of our fiscal firepower” through tax and spending decisions in the Budget to protect jobs and livelihoods.
But the chancellor left no doubt that tax rises are also on the way to rebalance the UK’s public finances, which have plunged more than £2 trillion into the red after he pumped £280bn of borrowed cash into schemes like furlough, business rates relief, support grants and VAT breaks – and much of this spending is expected to be extended in Wednesday’s Budget.
Tom Batchelor3 March 2021 08:19
Good morning and welcome to The Independent’s coverage of today’s Budget.
Tom Batchelor3 March 2021 08:16