Tax cuts, Labour partys unpopularity, Ukraine war: What to expect from todays UK budget?
A major overhaul is expected to come to the country's property taxes, something that has not been tampered with in a long time. Other such expected moves are also almost certain to make the Labour Party unpopular in certain sections of the voting public.
New Delhi: Expectations are high in the UK for the budget announcement today. As Chancellor of the Exchequer Rachel Reeves unveils her much-anticipated budget on Wednesday, months of speculation would come to an end clearing away a long period of tumultuous worries prevalent in the UK public.
Reeves is expected to unveil a ‘smorgasbord’ of tax rises in an attempt to plug the gap in the country’s finances which are currently estimated to be in the billions. The speaker of the House of Commons, Lindsay Hoyle, called it "the hokey cokey budget”, accusing the chancellor of not sharing information regarding the budget in the parliament.
What to expect from the budget?
The much-anticipated budget comes after two ministers announced tax changes on Tuesday. One was health secretary Wes Streeting confirming the expansion of ‘sugar tax’, levied on the soft drinks industry. On the other hand, communities secretary Steve Reed announced that mayors in England will be given the power to impose a tourist tax. This is to include a "modest” charge on visitors staying in hotels and other such establishments.
There were also reports regarding confirmation that minimum wage rates will increase next year. Of the preparations and the details of the budget, Reeves in a statement in the House of Commons said that she would "take the fair and necessary choices to deliver on our promise of change”.
The key aspect of the budget that a lot of things would hinge on is how much money can be spent without increasing borrowing levels. With a spending gap estimated between £20bn and £30bn, and no recourse to extra borrowing, to close the gap would be the key task of the budget. This could be done through either massive spending cuts or tax rises, both if done excessively can hamper other economic prospects of the government and result in a loss of the general popularity of the party amongst certain sections of the public.
In aid of reaching its goal to close the spending gap, many ideas are being speculated on that the government could take. Measures to bring down inflation and reduce the cost of living are reportedly on the table. It is also expected that removal of some levies from household electricity bills would be coming into place.
A major overhaul can also be seen in the country’s property taxes, something that has not been tampered with in a long time. Reeves could be the first to do so in a long line, and in part of these changes, council tax could also be tweaked.
When it comes to combating the government's spending, changes to how the welfare system operates can be imminent, being a major part where a lot of government expenditure goes. Tackling retiree benefits can also be done, a reduction which is not likely to go well with Britain's public.
The expected moves are not likely to go down well with the public, as the ruling Labour party reportedly commands less than 20 per cent support in recent opinion polls. This is devastatingly low, especially as they came to power with a landslide victory.