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Fiscal policy under New Labour

Article Abstract:

United Kingdom fiscal policy since the election of a Labor government in 1997 has been constrained by political and economic factors. Governments tend to impose tight fiscal policy after elections and looser policy prior to elections. There was also concern about the impact of a consumer boom in 1997, which led to calls for tight policy, and the government was committed to not raising taxes, for political reasons. This was the background to the 1997 Budget. Households were affected by lower mortgage interest relief and higher taxes on motoring and smoking, but business sources provided most extra tax from an excess profits tax on utilities.

Taxation, Budget, Budgeting, Budgets

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Fiscal policy and the budget

Article Abstract:

Political issues will inevitably have considerable influence over the fiscal policies adopted by UK chancellor Kenneth Clarke. In the case of the budget for 1996/1997, for example, there was considerable political pressure for tax cuts, especially as opinion polls indicated a serious decline in support for the government. There have been signs of economic slowdown since autumn 1995, but Kenneth Clarke remains confident that the fundamentals of the UK economy remain strong.

Political aspects

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Fiscal policies and the pre-election budget

Article Abstract:

Macroeconomic conditions in the UK seem to indicate that it is a good time for a pre-election fiscal boost. However, there are always macroeconomic dangers associated with a policy of tax reduction. Encouraging consumer spending through reducing taxes could boost inflation and damage industrial competitiveness.

Analysis, Economic aspects

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