"We believe that income tax is likely to rise because it's the single biggest and most reliable source of government revenue. It raises far more money than capital gains or inheritance taxes, for example, making it the fastest way for the Treasury to close the fiscal gap. This Budget is shaping up as one of the toughest in years. Reeves is trying to fill a deep fiscal gap while keeping credibility with the markets. The combination of sluggish growth, high debt servicing costs, and stubborn inflation means the Treasury's options are narrowing fast. Raising income tax thresholds or rates now looks, we believe, inevitable."
"The government's borrowing costs remain near multi-decade highs, and public debt has topped 97% of GDP. The interest burden on the debt pile is still crushing. Reeves knows she has to find revenue somewhere, and she's running out of alternatives."
Rachel Reeves prepares to deliver her first Budget on 26 November and described the Budget as "difficult". She refused to rule out tax increases. Nigel Green, CEO of deVere Group, warns income tax is likely to rise because it is the largest and most reliable source of government revenue and raises far more than capital gains or inheritance taxes. The government faces sluggish growth, high debt servicing costs, stubborn inflation, borrowing costs near multi-decade highs, and public debt above 97% of GDP. Raising income tax thresholds or rates looks increasingly likely, while capital gains and dividend tax increases alone will not close the fiscal gap.
Read at London Business News | Londonlovesbusiness.com
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