Ahead of UK budget, Hunt says forecasts ‘have gone against us’

Ahead of UK budget, Hunt says forecasts 'have gone against us'

LONDON: British finance minister Jeremy Hunt said there had been a deterioration in the economic forecasts that will underpin this week’s annual budget statement and he played down speculation over big pre-election tax cuts.
The forecasts by Britain’s official budget watchdog “have gone against us,” Hunt told the Sunday Telegraph newspaper.
“We don’t have as much of a positive outlook as we had at the end of the Autumn Statement,” he said in an interview, referring to a budget update last November.
“So it’s going to be a budget where we stress the progress we’ve made on bringing down inflation, but also the importance of being responsible with the country’s finances.”
Hunt and Prime Minister Rishi Sunak are under pressure from within their Conservative Party to cut taxes in Wednesday’s budget to help the party’s flagging fortunes before a national election expected later this year.
Speaking to Sky News on Sunday, Hunt said he would like to cut taxes further, but would only do so if that did not require higher public borrowing.
“What you saw in the Autumn Statement was a turning point, when we cut two pence off the National Insurance rate. We will hope to make some progress on that journey, but we’re going to do so in a responsible way,” Hunt told the broadcaster.
“It would be deeply un-Conservative to cut taxes in a way that increased borrowing,” he added.
Although Hunt announced cuts to business and payroll taxes in November, Britain’s overall tax burden has risen steadily in recent years and is on course to hit its highest since World War Two, largely because thresholds for paying many taxes have not risen in line with inflation.
The finance ministry said it planned to improve public sector productivity – for example by using artificial intelligence to speed up health checks using scanners and technology to free police officers for frontline tasks – which would deliver up to 1.8 billion pounds ($2.3 billion) of worth of benefits annually by 2029.
Hunt said the government would focus on spending carefully, potentially opening up space in the budget for further tax cuts.

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