Free Market Wonks Recoil at Hunt’s Tax Hikes mdi-fullscreen

Guido once again brings you the lowdown on wonk world’s reaction to the autumn statement. As expected, the free market think tanks aren’t happy…

The TaxPayers’ Alliance Chief Executive John O’Connell slammed the Chancellor for whacking up taxes on working families:

“These plans look set to prolong the crippling cost of government crisis. Taxpayers will take a kicking over the coming years to pay for a raft of spending increases, with most tough decisions seemingly kicked into the long grass. The government should have set out how they will get costs under control, not compounded the misery of sky-high inflation with tax hikes on working families.”

Institute of Economic Affairs Director-General Mark Littlewood was similarly unhappy:

“The Chancellor has put the United Kingdom firmly on track for higher taxes, more spending, and lower growth. This is a recipe for managed decline, not a plan for prosperity […] Jeremy Hunt is right to emphasise the need to bring down our debt burden and slow down the growth in government spending. But the consequence of considerable tax hikes could be a deeper and longer economic downturn – ultimately resulting in less taxpayer revenue over the long-term.”

Adam Smith Institute Head of Research Daniel Pryor declared the statement “a return to managed decline”:

“Entering a recession promising the highest tax burden in three-quarters of a century does not strike the right balance between fiscal credibility and growth. The Chancellor highlighted the harms of inflation, then added fuel to fire by threatening yet more tax threshold freezes—undermining productivity whilst hitting the pockets of people across the income spectrum.”

Centre for Social Justice CEO Andy Cook, meanwhile, wasn’t so brutal :

“The return of ‘compassion’ to the government’s political lexicon is welcome and overdue. Today the Government answered calls from the Centre for Social Justice and others to uprate the incomes of the poorest households in line with inflation, against fiercely competing pressures on the public purse. For this the Chancellor deserves credit. But the cost-of-living crisis is far from over. Many people who are just about managing will, come Christmas, be barely coping if at all. As recession darkens over the UK economy the Government must go further than welfare top-ups and accelerate plans to help people into productive employment.”

Centre for Policy Studies Director Robert Colvile took to Twitter for a brief reaction. Not quite the champagne-popping statement from Kwasi’s plan back in September:

“Notable mostly for the truly awful things that were avoided after being trailed, [especially] on tax […] Nothing there that any one group is going to massively howl about – pain spread evenly (apart from on the rich and no one likes them anyway)”

Onward Interim Director Adam Hawksbee gave Hunt a thumbs up for taking “tough decisions“:

“The Chancellor’s main job today was to begin restoring political stability and economic credibility. He has taken tough decisions in a difficult environment to achieve that goal. And he seems to have done so in a way which limits the impact on the most vulnerable, protecting benefits while taxing high earners and energy companies. Today was not a return to austerity. The difficult task ahead is to boost growth and unlock opportunity across the country…”

Policy Exchange Head of Economics and Social Policy Connor MacDonald also praised Hunt for taking a “balanced approach”

“The Chancellor unveiled a fiscal statement today that took a balanced approach, in the midst of huge economic uncertainty generated predominantly by factors external to the UK. It protected core public services and maintained capital and R&D spending, ensuring that the UK’s growth prospects are not unduly undermined. The decision to uprate benefits was on balance the right one, although a wider discussion needs to be had about the sustainability of the triple lock going forward. The Government made the right moves on energy, including an expanded windfall taxes and will significantly increase efforts around efficiency and maintains commitments to greater energy resilience. This is not an austerity budget.”

Institute for Fiscal Studies Director Paul Johnson said that while the statement wasn’t as grim as had been briefed… it still wasn’t great:

“The next few years look grim in terms of living standards, the biggest reduction in household incomes, possibly on record and certainly within recent generations.”

Plenty of talk this morning from the Chancellor about “unfunded tax cuts“. There are no such thing. There’s only unfunded spending…

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