Estimated Headroom for Tax Cuts ‘Little More Than Guesswork’
15 February 2024
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IEA Economics Fellow Julian Jessop has written for The Daily Express discussing the outlook for tax cuts at the upcoming Budget.
Julian wrote:
“The amount of headroom we actually have for tax cuts is little more than guesswork. The Office for Budget Responsibility’s estimates are based on speculative forecasts, incomplete modelling and arbitrary fiscal rules.
“Hunt could either raise thresholds to take more people out of income tax altogether, or cut national insurance contributions on lower wages.
“If this is more about improving the “supply side” of the economy – the incentives to work, create jobs or invest – tax cuts should target the high marginal rates faced by many other households, and the rising burden on businesses.”
Read the full piece in The Daily Express (15/02/2024, p.4)
Julian wrote:
“The amount of headroom we actually have for tax cuts is little more than guesswork. The Office for Budget Responsibility’s estimates are based on speculative forecasts, incomplete modelling and arbitrary fiscal rules.
“Hunt could either raise thresholds to take more people out of income tax altogether, or cut national insurance contributions on lower wages.
“If this is more about improving the “supply side” of the economy – the incentives to work, create jobs or invest – tax cuts should target the high marginal rates faced by many other households, and the rising burden on businesses.”
Read the full piece in The Daily Express (15/02/2024, p.4)
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