Today’s mini-budget gave much-needed clarity over the Government’s future economic policy – but the Chancellor must make driving down inflation and lowering interest rates a top priority.
Mitch Gough, director at Q Financial Services, said moves to cut taxes and Stamp Duty, reverse the planned increase in National Insurance and scrap planned increases on Corporation Tax, would all help address the cost-of-living crisis and build on measures announced earlier this week to control both residential and commercial energy bills.
But Mitch added that allowing inflation and interest rates to soar still further – and failing to support the supply of new housing developments to meet demand fuelled by the Stamp Duty cuts – would hinder future progress.
“It is good to see the Government place such a clear priority on growing the economy and introducing a detailed set of proposals so soon after the new Prime Minister took office,” Mitch said.
“After a period in which there seemed to be considerable drift, it is welcome that we now have a clear indication of the path the Government plans to take to help business and the commercial sector through this difficult period.
“There is no doubt that the cut in Stamp Duty will fuel new demand in the property market, but this must be met with a sustained increase in supply if housing is to remain affordable.
“Yesterday’s 0.5 per cent rise in interest rates to 2.25 per cent and the prospect of future increases and high inflation could mean that much of the extra cash the Government is handing back in this package is quickly eroded.
“We want to see serious moves to tackle inflation and help reverse the trend for ever-rising interest rates, but fully support the drive for growth.
“As ever, the devil will lie in the detail and we will be studying the Chancellor’s statement in great detail over the coming days to ensure we offer the most comprehensive advice possible to both our private and commercial clients.”