England (Commonwealth Union) – Often when an economic crisis emerges throughout history, scapegoats are often found, some with a genuine blame to bear and others often victims of a diversion of attention, with no clear understanding of the root cause of the problem.
Calls to tax the rich are often heard although critics argue that taxing the rich simply results in them relocating to destinations that have lower tax. With large sums of money to invest, many destinations across the world would be keen to attract them as potential investors.
Many economists have predicted that more countries across the world are likely to continue to see further economic issues, which they have indicated are primarily occurring as a result of the recent COVID-19 pandemic, the ongoing Russia – Ukraine war and the large amounts of debt most countries have found themselves in.
As inflation reached a 41-year higher, taxes and lower government spending are expected, as Jeremy Hunt, Chancellor of the Exchequer has warned of tax hikes. Some of the expected announcements in the budget include Tax thresholds freeze with a stealth tax. Examples of stealth tax include sales taxes, value added taxes, tobacco taxes, liquor taxes, air travel taxes etc.
The 10 year long cap on council tax rise is likely to be hiked to approximately 5%. Jeremy Hunt is expected to raise state pension set for record hike as September inflation hits 10.1%. meanwhile, former Prime Minister Liz Truss’s energy price assurance to cap average bills at £2,500 for 2 years is set to be further increased.
The incumbent Prime Minister Rishi Sunak blocked plans to bring back Labor’s 50p top tax rate, however he was open to proposal to reduce the starting threshold, which may be directed toward higher earners. The windfall tax is likely to see a change with a 25% levy imposed on oil and gas profits in the coming weeks that maybe raised to 35% and could be continued till 2028 rather than 2025.
