Reeves could raise billions and not break pledges -IFS

RACHEL Reeves could raise tens of billions from tax reforms without breaking Labour's manifesto pledges but must avoid “half-baked fixes” to Britain's economic woes at the Budget, leading economists have said.

- NINA LLOYD

The UK Government is under pressure to balance the books ahead of November's autumn statement amid warnings of a black hole estimated to be as much as £50bn in the public finances.

But in a wide-ranging report, the Institute for Fiscal Studies urged the Chancellor to resist “simply hiking rates” without making other changes to an “unfair” and “inefficient” tax system.

It also warned that restricting income tax relief on pension contributions “should be avoided” and repeated its cautions against an annual wealth tax, which it says would penalise savers, or increasing stamp duty.

Among the options available to the Chancellor as set out by the IFS are:

Ending capital gains tax relief on death, which allows for assets to be inherited without paying CGT on the increase in value over the deceased person's lifetime, to raise £2.3bn in 2029-30;

Double council tax rates on the top two property bands to raise £4.4bn.