IFS warns next government over tax rises and cuts

The Institute for Fiscal Studies (IFS), has warned that next government faces a stark choice regarding tax rises, spending cuts, or increased borrowing beyond their manifesto pledges.

The implications of these choices are set to impact the country's public services and financial stability.

According to IFS director Paul Johnson, both Labour and the Conservatives have maintained a "conspiracy of silence" on their spending plans, leaving voters in a "knowledge vacuum" ahead of the General Election on July 4.

Mr Johnson criticized Reform UK and the Green Party for proposing "wholly unattainable" radical reforms that could further complicate the fiscal landscape.

He pointed out that despite high tax levels in the UK, public services are struggling to meet demands.

The country is facing challenges such as a significant increase in debt interest spending, growth in the welfare budget, rising health expenditure, and the need to transition to net zero emissions.

The IFS analysis indicates that taxes are already at the "highest level ever" in the UK, yet further increases or spending cuts may be necessary in the coming years to address the financial imbalance.

Mr. Johnson emphasized the need for primary surpluses to prevent the debt from spiraling upwards, highlighting the government's responsibility to collect more in revenue than it spends.

The IFS also cautioned that the manifestos of the main parties ignore the substantial challenges at hand, indicating that tough decisions on the size and shape of the state will need to be made, likely resulting in higher taxes or reduced public services.