THE UK Chancellor is considering a cut in National Insurance in the Budget, it has been reported, as experts warned he must spell out how any pre-election giveaways will be funded.
Jeremy Hunt is facing continued pressure from Conservatives to cut taxes next week in what is likely to be his final Budget before the next General Election, as the overall tax burden approaches record levels.
Other measures which he is said to be considering include launching a duty on vaping products, with the aim of costs being passed on to consumers with the hope that it would make the habit unaffordable for children.
The Chancellor is expected to make final decisions on his plans for the Budget on March 6 at the end of this week.
READ MORE: IMF urges UK Government not to impose further tax cuts
However the Institute for Fiscal Studies (IFS) said he should resist announcing tax cuts unless he can show how he will pay for them.
The IFS warned that current post-election spending plans already meant further cuts to unprotected public services – such as local government and the court system – which reducing taxes would only exacerbate.
READ MORE: Recession confirmed by latest GDP figures in blow to Rishi Sunak
Martin Miklos, research economist at the IFS, said: “In November’s autumn statement, the Chancellor ignored the impacts of higher inflation on public service budgets and instead used additional tax revenues to fund eye-catching tax cuts.
“At next week’s Budget, he might be tempted to try a similar trick, this time banking the higher revenues that come from a larger population while ignoring the additional pressures that a larger population will place on the NHS, local government and other services.
“He might even be tempted to cut back provisional spending plans for the next Parliament further to create additional space for tax cuts.
“The Chancellor should resist this temptation. Until the Government is willing to provide more detail on its spending plans in a spending review, it should refrain from providing detail on tax cuts.”
Why are you making commenting on The National only available to subscribers?
We know there are thousands of National readers who want to debate, argue and go back and forth in the comments section of our stories. We’ve got the most informed readers in Scotland, asking each other the big questions about the future of our country.
Unfortunately, though, these important debates are being spoiled by a vocal minority of trolls who aren’t really interested in the issues, try to derail the conversations, register under fake names, and post vile abuse.
So that’s why we’ve decided to make the ability to comment only available to our paying subscribers. That way, all the trolls who post abuse on our website will have to pay if they want to join the debate – and risk a permanent ban from the account that they subscribe with.
The conversation will go back to what it should be about – people who care passionately about the issues, but disagree constructively on what we should do about them. Let’s get that debate started!
Callum Baird, Editor of The National
Comments: Our rules
We want our comments to be a lively and valuable part of our community - a place where readers can debate and engage with the most important local issues. The ability to comment on our stories is a privilege, not a right, however, and that privilege may be withdrawn if it is abused or misused.
Please report any comments that break our rules.
Read the rules here