The Chancellor intends to move to one budget a year. He also made clear that budget will be each Autumn. The budget we have just witnessed was designed to change little, and to launch various consultations ahead of the main event. It is therefore a little unfair of some to complain that the March budget did not set out what he intends to do post Brexit, nor did it herald and develop the economic opportunities Brexit presents. Let’s hope that comes in the autumn.
Over the next few weeks I will include some articles on this site looking at the opportunities in various departments and sectors. The first general point to make in today’s opening article is that post Brexit the government will have more money at its disposal to cut taxes, increase spending or reduce the running deficit, thanks to the cancellation of our substantial net contributions. The balance of payments will get an immediate and substantial continuing boost once we cease making those payments abroad for our financial contributions. As the balance of payments deficit has been all too large during our years in the EU and especially in recent years, this will be a welcome improvement.
The Leave campaign by way of illustration of the advantages of cancelling the payments said it could be spent on the NHS. They always made clear it would in practice be up to the government of the day to decide what to do about the saved money. As part of the Vote Leave campaign I set out a detailed possible post Brexit budget, which combined increased NHS spending with more money for social care and a series of tax cuts taking VAT off tampons, green products and domestic fuel. These proposals made it to the Today programme and the Telegraph amongst others. That illustrative budget had some worthwhile ideas in it. Indeed, the extra money for social care has just appeared in the latest budget and is welcome.
One of the big advantages of Brexit will be the restoration of our own control over taxes. The VAT cuts I suggested should be popular across the political spectrum, tackling excessive energy bills which fall hardest on people on low incomes, and encouraging more energy saving which makes sense. I would also like to see in the Autumn budget measures to cut tax rates where the rates are currently too high to maximise the revenues. It seems clear, for example, that the last Chancellor’s penal Stamp Duty rates have cut property transactions markedly, to the detriment of total revenues and getting in the way of people improving their property and tailoring their home to their latest family and income circumstances.