Reeves Needs £50 Billion Buffer to End UK Tax Hikes, IFS Says
The Institute for Fiscal Studies (IFS) has stated that Chancellor Rachel Reeves needs to increase the fiscal buffer to £50 billion in order to avoid further tax hikes and spending cuts in the UK. The current fiscal buffer, which is the amount of headroom the government has to absorb unexpected events or economic shocks, is around £10 billion. However, the IFS believes this is insufficient and Reeves needs to raise it significantly to have a better-than-even chance of avoiding additional tax increases and spending cuts in the coming years. The report suggests that the government faces significant fiscal challenges, including the need to fund public services and address the impact of the COVID-19 pandemic and the cost-of-living crisis. The IFS has urged the government to take a proactive approach in strengthening the fiscal position to provide a cushion against future economic uncertainties.
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