The Chancellor has officially asked the Office for Budget Responsibility (OBR) to prepare their independent forecast for the late November date to accompany the Budget. Announcing the date, Chancellor Rachel Reeves admitted that the Budget is “not working well enough for working people”.

Scheduled around a month later than last year, the government is thought to be biding their time, in hope that the UK economy will outperform City forecasts and calm the fears in bond markets, with leading economists claiming inflation will hit 4% in September and growth remaining stagnant.

Business confidence is fragile and the expectations of further tax-raising measures to manage a potential £50 billion shortfall in upcoming Autumn Budget is amplifying concerns. For businesses, planning investment, recruitment and payroll is becoming increasingly challenging.

The Chancellor previously pledged there would be no future increases in income tax, national insurance contributions, or VAT but there is widespread speculation of a U-turn. The government has declared that it will refrain from further borrowing. However, given the already implemented expenditure reductions, it appears that there are limited alternative options available, other than raising taxes. The relatively delayed Budget date may present the Chancellor with the opportunity to establish the necessary groundwork for any such adjustments.

Ruth Curtice, Chief Executive of the think tank, Resolution Foundation, was quoted in saying: “The Chancellor has officially fired the starting pistol on the countdown to one of the toughest second Budgets in living memory.”

The primary concern is that whilst the Chancellor draws up her package of measures, speculation regarding tax increases is rampant, further stirring market jitters, engendering disincentive to investment, negatively impacting productivity and does little but put a further drag on growth.