The Institute for Fiscal Studies (IFS) has called on Chancellor Rishi Sunak to use the upcoming Budget to secure economic recovery, instead of focusing on public finances.
The business group expects the Budget, which is due to take place on 3 March 2021, to outline extensions in emergency support for businesses and households.
However, the IFS said the Budget should also address plans to phase out existing support schemes as restrictions ease.
It added that although substantial tax rises will be needed in future to make up for the additional spending that has been required as a result of COVID-19, these should not be introduced in the upcoming Budget.
Paul Johnson, director at the IFS, said:
“This will be just Rishi Sunak’s second Budget, but his 15th major fiscal announcement. In it, he needs to strike a balance between continuing support for jobs and businesses harmed by lockdowns and weaning the economy off blanket support which will impede necessary economic adjustment.
“Any significant continuation of the furlough scheme must be limited and carefully targeted.”
We will be covering the Budget on the day – for more information on how any changes affect you, get in touch.
UK economy dipped ahead of Budget
Unexpected contraction strengthens rate-cut expectations.
