EY’s Item Club are the latest group to suggest Osborne’s giveaways will run to around £3bn, projecting that the Office for Budget Responsibility (OBR) will slash the UK’s borrowing forecast to £110bn. This would mean a reduction of £10bn from the OBR’s most recent forecast, following from robust economic growth.
With action on rising energy bills likely to be one of the centrepieces in the speech, the Item Club say that the £50 cut in green levies that has been floated would cost the Treasury about £1bn in foregone tax revenue.
EY’s Chris Sanger, claims that other tax changes should be minor: “Any tax tinkering is likely to involve the introduction of tightly focused, targeted tax incentives focused on employment and training.”
Carl Astorri, senior economic adviser to the Item Club adds that new moves on house building could be welcome: “Speeding up the planning system, releasing unused government land for development, or even providing the green light for the construction of new towns, could have a real impact.”