Budget 2013: IFS warns of £9bn tax rises after election

Tax rises of up to £9bn – equal to a 2p increase in the basic rate of income tax – could be imposed after the next general election to limit further cuts in public spending, experts warned on Thursday.

The scale of the spending cuts scheduled for 2015 in George Osborne's budget will be so difficult to implement an incoming government would have little alternative but to raise taxes or borrow more, the Institute for Fiscal Studies said.

The IFS, which produces a keenly watched analysis of the chancellor's budget, gave its warning after the Treasury's independent forecaster, the Office for Budget Responsibility, warned that growth would halve this year to 0.6% and the recovery would be weaker than predicted only in December.

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In a budget that kept the coalition tied to its austerity theme, Osborne was forced to admit that the UK would take two years longer to push the annual deficit below 3%. A rise in the personal income tax threshold to £10,000 next year, together with a 1p cut in beer duty and the abolition of a planned fuel duty rise in the autumn, were offset by a further tightening of Whitehall budgets to leave what the IFS described as a fiscally neutral budget that masked a further deterioration in the government's finances.

http://www.guardian.co.uk/uk/2013/mar/21/budget-2013-ifs-9bn-tax-rises-election