Finance

Tax burden to be highest in 30 years, says think tank

Source: bbc.co.uk

Tax is set to rise as a share of the UK’s income to its highest level since 1986, according to a think tank.

Higher income from taxes and relatively low growth will combine to create this effect, according to the the Institute for Fiscal Studies.

Austerity will continue into the 2020s, after Chancellor Philip Hammond’s decision to scrap a target of balancing the nation’s books, it said.

The Treasury said it was committed to repairing Britain’s finances.

Forecasts by Oxford Economics, which contributed to the report, estimate the UK economy will grow by 1.6% in 2017.

In 2018, growth in gross domestic product will slow to 1.3%, Oxford Economics said. Growth is expected to be dulled as a result of inflation prompted by the decline of the value of the pound after the EU referendum.

While a weaker pound is likely to improve the performance of manufacturers and exporters, higher costs for consumers will more than erase this gain, said the report.

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