Rishi Sunak’s Budget next week will be comparatively limited – extending existing support for the pandemic-ravaged economy, but detailing little of the government’s mooted five- to ten-year “endemic recovery plan”. Reports suggest that a further £30bn of Covid-related payments will made available, including help for businesses and an extension of the furlough scheme, with spending in other areas little changed from previous announcements. A staggered rise in corporation tax, from 19 per cent to 23 per cent, rather than the suggested 25 per cent, is likely, as are changes to the capital gains tax system, which mostly affects wealthier taxpayers, alongside the potential introduction of new digital taxes.
But there is the option of a Spending Review in the autumn, allowing the government to postpone major decisions until – hopefully – the lockdown is a receding memory. Sunak will almost certainly use the Budget as an opportunity to kick the can a little further down the road. Duty reductions on beer might add a swing to the unlocking parties already being planned, but they’re not exactly the foundations of a new economy.
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