But the gap between public spending and income was still one of the biggest among advanced economies, it added. “The deficit is now roughly back to the level it was prior to the financial crisis, although is still above its long-run average. On the tax side, the impact on the public finances of substantial tax cuts has been more than outweighed by tax raising measures,” said Carl Emmerson, deputy director of the IFS and author of the report. But despite this, overall public spending remains slightly above its pre-crisis share of the economy. “Eliminating the deficit before a May 2022 general election would be even harder: a combination of tax rises and spending cuts worth £15bn on top of current plans.”

Source: The Guardian May 02, 2017 16:35 UTC