For weeks, we have been told that today’s Budget was a make-or-break moment for the chancellor, the Government and the economy. Higher tax revenues as a result of higher wages offset much of the impact of a downgrade to productivity forecasts to take account of the damage from Brexit and the global financial crisis. But the bulk of those tax rises will come in the form of freezes in personal allowance for three years after 2028. Nonetheless, backdating tax rises to pay for higher welfare today is not without risks. According to Deutsche Bank, 47% of the tax rises will not come until the last year of the current parliament.
