“Although the COVID-19 crisis is far from over and still presents a serious risk to the outlook, the economy is recovering strongly and the urgent need for emergency fiscal policy support has subsided,” said Kallum Pickering, a senior economist at Berenberg Bank.
Britain has experienced a series of shortages these past few months, from a lack of fuel at gas stations to not enough workers picking the fall harvest, but Treasury chief Rishi Sunak is unlikely to dwell on them when he delivers his annual budget statement on Wednesday, the AP reports.
The Chancellor of the Exchequer, as he is formally known, will instead likely use one of the most high-profile, choreographed events in the country’s political calendar to paint a relatively rosy picture of the state of the British economy following the devastating shock of the pandemic.
With government borrowing less than anticipated a few months ago — following a fairly solid recovery from Britain’s deepest recession in around 300 years — Sunak has a bit of wiggle room on the taxes and spending front.
However, with the next general election not due until 2024 at the latest, Sunak is not expected to turn into Father Christmas — big tax giveaways in Britain are traditionally timed for the run-up to a general election.
Sunak’s overall focus on Wednesday is expected to be stabilizing public finances following the battering they took during the pandemic, which saw the Conservative government respond with an arsenal of support measures for workers and businesses. Tax increases on business profits and people’s incomes have already been announced to get borrowing to more sustainable levels over coming years.
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