Tax and Fiscal Policy

‘Steady as she goes’ budget lacks ambition


In the Media

Prof. Len Shackleton quoted in Conservative Home and Guido Fawkes

In the Media

Mark Littlewood quoted in The Times

Mark Littlewood writes in The Times

IEA Director General Mark Littlewood has written in The Times responding to the 15th March budget, arguing that it is not radical enough.

Mark wrote:

“The UK is one of only three countries in the developed world to increase taxes on profits over the past year or so. France, not often seen as a beacon of free-market entrepreneurialism, decided to reduce it.

“Expect decisions by big companies on whether to invest in Britain to be interpreted through this lens. See AstraZeneca’s recent decision to build a £400 million facility in Dublin, citing the UK’s “discouraging” tax rate. It’s not only higher taxes on profits that will deter investment, but uncertainty too. Less than a year ago, Hunt advocated a reduction in corporation tax to 15 per cent. He has now decided 25 per cent is the sweet spot.

“Fundamentally, this budget was nowhere near radical enough. Public spending will remain at its highest since the Second World War. The tax burden remains broadly the same as that of Clement Attlee’s government of the 1940s, and has edged up inexorably over 13 years of Conservative-led government. The fiscal drag caused by tax thresholds being frozen will mean more than three million people are pulled into paying income tax. This was intended to be a ‘steady as she goes’ budget, but it will do little for our long-term malaise.”

Read the full piece can be read here.