Ben Zaranko
Senior Research Economist,
Institute for Fiscal Studies
What should the Prime Minister do? If Jeremy Hunt is determined to cut taxes, he should focus on changes that improve Britain’s growth prospects. He would get more for his money if he reduced or abolished stamp duty on house and share purchases, rather than lowering overall rates of income tax or national insurance.
what he shouldn’t do The key thing the German finance chancellor should avoid is writing another chapter of his fiscal novel. He should avoid proposing additional unspecified spending cuts in the next parliament in order to “pay the bill” (barring some fairly radical cuts to what the country is expected to deliver, these cuts are likely to be unachievable). Clear tax cuts today.
Tom Craherty
executive Director,
Economic Research Institutes
should Given the fiscal space, the chancellor should prioritize reforms that have a lasting impact on the economy rather than pre-election giveaways. Some technical changes to corporation tax and business rates would help, but scrapping the distortionary and damaging stamp duty – or cutting it where possible – should be the first desire.
shouldn’t Hunter should not create a budget black hole for his successor. Keeping real per capita public spending flat is good, but it must be accompanied by reforms. The fact that public services are under-resourced yet do nothing to improve their productivity has been a major failure of the past decade.
James Smith
Research Director,
Resolution Foundation
should The chancellor should show he is not just concerned about short-term giveaways by addressing the “fiscal fiction” issue in his post-election spending plans. He should announce a year-long spending review before the summer so government departments don’t go to an election without knowing the public services budget months before. If he’s going to cut taxes, he should improve the tax system – scrapping the high-earning child benefit charge that makes parents pay high rates – and not raise stamp duty next year.
shouldn’t He should not double down on spending cuts after the election, plan for even deeper cuts, and use up all his wiggle room on tax cuts. Costly and poorly targeted income tax cuts and wasteful estate tax cuts should be avoided. Cuts to national insurance would be more targeted at workers and could be used to reduce some of the biggest distortions in the tax system.
Katie Schmucker
Chief Policy Advisor,
Joseph Rowntree Foundation
should He should propose lasting solutions to two decades of rising deep poverty. We must build a system that helps us all when we encounter difficulties. Universal Credit requires a “necessities guarantee” so that people can afford at least the necessities of life.
Should not: The chancellor should not think the cost of living crisis is over. Millions of people lack the necessities of life and support is about to end. It is important that the Home Support Fund (HSF) is not abolished so that parliaments and the devolved governments avoid reductions in cash payments and support for people in crisis.
Mark Littlewood
Popular Conservatism (PopCon) Director
should Enacting some meaningful spending limits would pave the way for the tax cuts he desires but seems unable to achieve. Instead of emphasizing one or two tiny tax cuts that would be outweighed by less transparent tax increases, he should work on reducing the tax burden across the board.
shouldn’t He shouldn’t praise the Office for Budget Responsibility [OBR] “Amazing Job” may be constrained by its forecasts, which are often off by £500m or more a year. OBR chairman Richard Hughes appears to have more control over fiscal policy than the government itself. Some meaningful efforts are needed to reverse this situation.
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