Major Tax Increases in The Near Future for The UK
With the UK being in major debt due to the global pandemic, future tax rises are inevitable as the nation tries to recover.
Here's What's in Store for The UK in Order to Restore The Economy and Recover From The Pandemic
It is being reported today that the British Finance Minister, Rishi Sunak, might have to raise taxes to a new high in order to help the government recover from the debt incurred by COVID-19.
The state has reportedly injected an estimated £200 billion into the economy in order to support jobs, business and incomes this past year. This could see the government raising taxes to approximately £60 billion.
While these tax rises are inevitable as the nation's debt continues to grow, the UK will not have to worry about this just yet, as Sunak’s March 3 budget announcement is reportedly too soon to raise taxes. Massive tax rises won't be in effect likely until the middle of the decade, as the UK continues to try to recover from the pandemic.
The non-partisan Institute for Fiscal Studies (IFS) stated that due to the unpredictability of the pandemic, Sunak should focus on initiatives that prevent losses of jobs and encourage business investment.
A £60 billion increase in taxes is equivalent to a nine-pence-in-the pound jump in income tax rates. However, the IFS has stated that such revenue raising shifts would likely be spread across different taxes.
GBP/USD is nearing 1.3950, backed by the success of Covid-19 vaccination rates in the UK and easing of restrictions.