Tax and Fiscal Policy

Tax hikes could be avoided with a stronger economy

Julian Jessop quoted in The Telegraph

The Telegraph suggests that Rishi Sunak could avoid tax hikes announced in the Spring Budget if the UK economy recovers more strongly than predicted.

Commenting on the news, IEA Economics Fellow Julian Jessop said: “I suspect he will be reluctant not to raise corporation tax to 25pc but he could offset that elsewhere in the tax system, by extending more generous investment allowances”.

Jessop also raised the possibility that the Chancellor could drop the freeze in income tax thresholds as a pre-election boost for the Conservatives if the economy allows it.

Read the full article here.