The Macroeconomics of Parties’ Tax and Spending Plans

Most economic analyses of parties’ tax and spending promises treat the government’s budget like that of a household, ignoring the impact of proposed policies on the economy.  This briefing aims to fill this gap by providing a macroeconomic assessment of announced fiscal policies. It focuses on:

• The impact of the parties’ tax and spending plans on economic output and consumer prices
• The combined impact of parties’ Brexit policies and tax and spending plans on the economy.
• How monetary policy is likely to respond to prevent inflation rising above target.
• A discussion of economic policies beyond tax and spending and their effect on the economy.

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