This group of Conservative modernisers declared the Budget a “missed opportunity.” Ryan Shorthouse, Director of Bright Blue said:
“The Government should be applauded for taking necessary and radical steps to try and increase participation in quality technical education and lifelong learning. But the Government is not doing enough to support those on modest incomes who feel and are left behind by the advance of globalisation and free markets. There will come a time when the Prime Minister is judged on her record, not just her rhetoric, in supporting ‘ordinary, working-class people’.
“Today’s Budget was a missed opportunity to transform the living standards and life chances of those who need and deserve the most support from government. The Government should have prioritised softening the blow on the living standards of working-class families by ending unjustified and unnecessary tax relief for those with the broadest shoulders, such as the inheritance and higher rate tax cuts.”
This pro Brexit group pointed to the positive economic forecasts. It’s co-founder Michael Gove said:
“During the referendum campaign people were all too happy to warn of recession and economic ruin should we vote to leave the EU. Today’s figures demonstrate that they were wrong.
“Our economy has not only been resilient since the referendum, it has flourished with record levels of employment, stronger economic growth and major inward investment announcements.
“Outside the EU we can look forward to an even brighter future by becoming a global champion of free trade, creating new jobs across a range of industries and spreading prosperity right across the UK.”
Centre for Policy Studies
The CPS was cheered that Government borrowing was lower than expected. Daniel Mahoney, Head of Economic Research at the CPS said:
“It is welcome that, despite the UK’s borrowing forecasts improving, the Budget 2017 was not full of giveaways. Furthermore, although changes around national insurance and the tax-free dividend allowance will have an impact on UK competitiveness, the re-commitment to cutting corporation tax to 17% by 2020 will help ensure that the UK remains open for business.
“However, the most encouraging aspect of this Budget was on education where Hammond asserted that ‘choice is the key to excellence in education’. This is absolutely right. The announcement of further funding for new free schools and grammar schools along with the promotion of technical education with the introduction of ‘T-levels’ will offer welcome choice to parents, while helping boost the long-term skills and productivity of the UK.”
The National Insurance changes were welcomed. Torsten Bell, the Foundation’s Director said:
“Today’s announcement is a bold and welcome move to ensure the tax system catches up with the modern world of work. There are lots of good reasons for people to be self-employed but unfair and expensive tax advantages shouldn’t be one of them.
“By abolishing Class 2 NICs and staggering the increase in Class 4 NICs, most self-employed workers will actually be better off next year, with higher paid accountants and management consultants taking the biggest hit.
“These tax rises should be part of wider reforms that address remaining incentives to become self-employed while offering greater support with the likes of maternity pay and pension savings that are particularly needed for the millions of workers at the precarious end of self-employment. This will send a firm message that the government really is on the side of ordinary working families.”
Institute of Economic Affairs
The IEA concluded the Budget was “sensible but unambitious”. Mark Littlewood, Director General at the IEA, said:
“This was a fiscally neutral Budget, but deficit elimination is now being done wholly by growth, not by savings. The Chancellor yet again said the right things about the need for fiscal discipline, yet despite savings in some areas, public spending continues to climb in cash terms and is little changed from 2010 in real terms. And whilst it’s right to continue to cut the budget deficit, the bigger issue is the overall levels of government spending and taxation – which are both still far too high.
“Broadly this was a sensible Budget which did not wildly overstep its remit of tax and fiscal announcements. Yet the Government is still lacking the gumption for some radical, big decisions on the size of the state. With an ageing population, these decisions cannot be put off forever. And while we’ve seen a levelling of the playing field today in moves to align tax rates and on a wider range of educational opportunities, the Government has again failed to tackle key issues such as intergenerational inequality.”
Adam Smith Institute
The ASI noted that the Budget was boring – and that there are worse charges that could have made. Sam Dumitriu, Head of Projects at the ASI, said:
“We knew this would be the dullest budget in recent history – the Chancellor even leaked that in advance. That’s not necessarily a bad thing – exciting budgets tend to contain ill thought-out ideas, but there’s a lot he should be doing now to prepare the economy for Brexit by cutting the worst taxes to make us more competitive.
“The Chancellor missed an opportunity to make major reforms to our outdated corporate tax system or tackle the thicket of loopholes and exemptions that plague our tax code. But, he has another budget in the Autumn, that’ll be where the real action is. He should think hard about deeper reforms then.”
The TPA noted that “the National Debt is still astronomical and growing”. John O’Connell, Chief Executive of the TaxPayers’ Alliance, added:
“It is good to try and equalise National Insurance payments between employees and the self-employed, but this should be done by cutting rates rather than hiking taxes on entrepreneurs. The Budget also failed to deal with destructive taxes such as stamp duty, which gums up the housing market, means that young families can’t get on the housing ladder and prevents older couples from downsizing when they would like to. In the longer-term, this pernicious tax should be abolished but at November’s Budget he should slash it in half.
“It is encouraging that the Chancellor appreciates that the Business Rates revaluation process must be more regular and much smoother. That will head off the kind of political storm he faced in the past few weeks where some small businesses received devastating hikes in their bills. But it was less comfortable watching Mr Hammond trying to deal with George Osborne’s sugar tax, where he was forced to commit to new spending because of uncertain revenue. Fiddly interventions like this are a distraction and should be binned in November.”