VAT, income and National Insurance taxes will all have to go up to pay for coronavirus, the ex HMRC chief has warned.
Sir Edward Troup today warned of “substantial rises” across the board with the pandemic leaving Britain’s finances looking bleak.
Speaking to Radio 4’s Today Programme, Sir Edward explained tax rises were inevitable with due to the vast amounts of public spending sparked by the crisis.
He said: “At some point taxes have to go up. Debt has gone up hugely, public spending is running at a very high level and it has to be paid for.
“The question for the chancellor and for future chancellors is when, how and how much extra tax do they need to raise?
“At the moment raising taxes seems out of the question given the state of the economy but it is absolutely right that the chancellors should be thinking what he or his successor should be doing in the future.
“That will involve some very substantial tax rises.”
In total, government borrowing reached £350billion this year — roughly ten per cent of GDP.
An adviser to several former chancellors, Sir Edward explained the hikes would have to come from the “big taxes”.
He said: “If the chancellor needs to raise serious amounts of money, he;s got to look at the big taxes, income tax, VAT, and national insurance.
“The scale of the problem means ultimately almost every household which is economically active in Britain will have to contribute.
“Although the minority, the richer people should play their part and play their part to the full, they cannot in themselves fill the whole.”
Sir Edward also warned this was a lot worse than the financial crisis of 2008.
He added: “This looks a lot worse, worse than 2008-9, at that time we thought it was a once in a generation event, this feels like a once in a hundred years event.
“The numbers are staggeringly large now and the long term threat to the public finances feels much greater.”
Did you miss our previous article…
https://www.hellofaread.com/politics/leicester-mayor-blasts-unnecessary-lockdown-as-decision-due-on-lifting-it-today/
