The opening remarks of Alistair Darling’s Budget speech showed that the Chancellor is well aware of Britain and the world economy’s ongoing economic woes. How troubling and disappointing, then, that his first Red Book will only make things worse.
There are four key failings. First, the Budget raised taxes yet again, the very worst thing to do at the start of an economic downturn. £1.5 billion extra will be raised from alcohol over the next three years, £1.6 billion from cars (even with the delayed fuel duty rise), and £1.7 billion extra from businesses, much of it in the familiar form of anti-avoidance measures.
Second, it failed to modify previously announced tax rises. An 80 per cent increase in the capital gains tax rate paid by many businesses will still go ahead, despite the concession on entrepreneurs’ relief.
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