The Chancellor has attempted to strike a balance between continuing to prop up the businesses worst affected by COVID-19, while setting out a roadmap to wean the UK economy off this emergency support.
In his second Budget and 14th fiscal announcement since succeeding Sajid Javid in February 2020, Sunak resisted the urge to start raising the main taxes in a bid to rebuild the UK economy and tattered public finances. His hands, however, were somewhat tied by the Conservative election manifesto of 2019, which pledged not to raise the rates of income tax, National Insurance contributions or VAT until 2024.
Former chancellor Philip Hammond had said that, despite the manifesto pledges being made in good faith before the pandemic, not all of those commitments could sensibly be delivered on. That’s despite the financial fallout from COVID-19 over the last year being the fiscal equivalent of fighting a war, with more than £280 billion already committed towards protecting the UK economy since March 2020.
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