For a man who has only delivered two Budgets, Rishi Sunak is no stranger to fiscal announcements. Last March’s £30bn spending splurge was just the start of hundreds of billions of pounds spent in the fight against Covid-19. Today Sunak pledged another £65bn: furlough and the Universal Credit uplift were both extended; incentive payments for businesses to take on apprentices were doubled; and ‘restart grants’ worth £5bn to help businesses get back on their feet were unveiled.
But this Budget wasn’t all giveaways. The Tory Chancellor announced a new, tiered system for corporation tax, which hikes the rate from 19 per cent to 25 per cent in 2023 for the most profitable businesses. He has also frozen personal income tax thresholds: dubbed a ‘stealth tax’, this will bump workers into higher tax brackets as wages rise while the thresholds don’t.
What does this mixed bag of policies mean for the UK’s economic recovery? The good news out of today’s Budget was an update from the Office for Budget Responsibility, which has moved forward its most recent forecast for GDP to return to pre-pandemic levels.
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