IFS: Reeves can fix £50bn gap and not break pledges

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.

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The 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 £50 billion 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: