The National Institute of Economic and Social Research added that there is ‘essentially no fiscal headroom for any further tax cuts’.
The winner of the next general election will have to raise taxes to maintain the current provision for public services, according to new analysis by a leading think tank.
In its latest economic outlook report, NIESR said it forecasts GDP will have grown 0.4% over the first quarter of 2024 and will rise 0.8% for the year as a whole, compared with 2023.Bank of England's interest rate “This will make it difficult for any incoming government to carry out the much-needed investment in infrastructure and the green transition, as well as increase spending on public services and defence, without either raising taxes or rewriting the fiscal rules.
NIESR also said in the report that it predicts there will next be an interest rate cut, from the current level of 5.25%, in August. It has factored in two cuts this year.
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