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Budget cancelled as Sunak opts to delay tough choices

23 September 2020

If you are covering the news that the Autumn Budget has been cancelled, please see the following commentary from Rachael Griffin, tax and financial planning expert at Quilter:

“The time to fix the roof is when the sun is shining, so It makes sense for the Chancellor to delay the tough decisions until at least next Spring. By then government will hope to have a much better idea of whether an effective vaccine is viable for next year, and the UK’s longer-term relationship with the EU ought to be clearer. At the moment it would be extremely challenging to make long-term policy decisions with so much up in the air. As we learn more over the coming months it may become a little easier to build an informed projection about the trajectory of the economic rebound. In turn, that makes it easier to build an evidenced based case for what may be some difficult policy decisions.

“The Conservatives will likely wish to maintain their reputation for prudence by reducing debt over the course of the Parliament, as they promised in their Manifesto. Although the goalposts have changed somewhat, it is difficult to see the Chancellor throwing caution to the wind and abandoning that pledge altogether. That means he faces the deeply unenviable task of repairing public finances without implementing tax policies that adversely impact recovery.

“Rishi Sunak’s stock is currently pretty high. Polling shows he has come through a rollercoaster six months in good shape, with the public clearly approving of measures like Furlough. If he can avert a major jobs crisis over the winter – a difficult challenge  - and maintain some of that good feeling with the public then perhaps he may yet be tempted to use it as a platform to implement some difficult revenue raising measures in March, ahead of the new tax year.”  

Mike Glenister

Corporate Affairs Manager

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