Spending cuts and tax rises likely to continue to the 2020s

Tax is set to rise to its highest level since 1986-87 according to the Institute for Fiscal Studies’ Green Budget 2017 with increases totalling £17bn planned over this parliament.

Day-to-day public service spending is due to fall by 4% in real terms over the next three years having fallen very little in the past three years. Despite the past seven years of austerity the deficit this year will be greater than in all but 13 of the 60 years before 2008 and remains the fourth biggest of 28 high-income economies.

Paul Johnson director of the Institute for Fiscal Studies said: ‘For all the focus on Brexit the public finances in the next few years look set to be defined by the spending cuts announced by George Osborne. Cuts to day-to-day public service spending are due to accelerate while the tax burden continues to...