Report

Revenue and reform

Think tank: Resolution Foundation

Author(s): Adam Corlett

September 10, 2024

This report from UK think tank the Resolution Foundation explores some of the tax policy choices that may face the new Chancellor.

Ahead of Autumn Budget 2024, this report explores some of the tax policy choices that may face the new Chancellor, and sets out what reforms could best raise revenue while also improving the design of the tax system.

There are many good reasons to expect a range of tax policy changes at this Budget. It will no doubt deliver on the Labour manifesto’s tax commitments, but the Chancellor will also need to grapple with a legacy of scheduled tax rises including upcoming increases in Fuel Duty and Stamp Duty and we set out proposals for these. It is also likely that there will be further new tax rises to ameliorate the public spending outlook.

The Government has ruled out some of the big revenue-raising tax options, but despite these constraints we find that there is still scope to raise substantial revenue – of over £20 billion if needed – with a focus on Inheritance Tax, Capital Gains Tax and pension contribution tax reliefs. Crucially, the recommended reforms would also make the tax system more consistent.

Progress is also needed to kick-off longer-term reform of other parts of the tax system, and we set out desirable directions of travel for business rates, Council Tax and the treatment of electric vehicles.