Majority of Britons pessimistic about future of UK economy as 70% expect Budget tax hike, new polling shows

Two-thirds of Britons are pessimistic about the future of the UK economy, new polling has suggested, as 70 per cent expect tax hikes in John Healey’s Budget.

Former defence secretary Mr Healey is under pressure to balance the country’s books as he prepares to delivers the first Budget of Andy Burnham’s premiership on Wednesday.

The chancellor is facing calls to ensure Britain’s military spending is ramped up, whilst also ensuring the string of pledges set out by the prime minister during his first weeks in office are fully funded with either tax hikes or billions in savings.

But new polling from IPSOS shows that 70 per cent of Britons believe it is likely the government will raise taxes they pay in the next year, compared with 17 per cent who think it’s unlikely.

Two-thirds of Britons think that the general economic condition of the UK will get worse over the next year, compared to just 14 per cent who think it will improve.

Meanwhile 67 per cent believe it is likely Labour will increase government borrowing and the national debt, whilst 51 per cent expect an increase in spending on public services.

Alex Bogdan, research director at Ipsos in the UK, said the survey suggests public pessimism “remains acute across demographic groups and political divides”.

"Ahead of John Healey’s first Budget, Britons remain troubled by widespread economic anxiety, with nearly two-thirds expecting the national economy to worsen over the next twelve months and keeping inflation low viewed as the primary prerequisite for growth,” she said.

“With seven in ten anticipating that the government will increase their personal taxes, public pessimism remains acute across demographic groups and political divides.

“While there is enduring public support for protecting the NHS, Britons show clear resistance to broad-based personal tax increases, preferring targeted measures on high earners or spending reductions on foreign aid.

“As Westminster navigates demanding fiscal constraints, the central challenge for the government will be addressing deep-seated cost-of-living concerns and demonstrating a credible path to growth without eroding voter confidence through widespread tax rises."

Mr Healey is expected to outline the proposals at approximately 12.30pm on Wednesday in the Commons, immediately after Mr Burnham has finished his weekly despatch box showdown with Kemi Badenoch at Prime Minister’s Questions.

One of the biggest challenges facing Mr Healey is that he will have to set out how the government will fund £5bn of defence spending announced in May’s Defence Investment Plan (Dip) without details of how it would be paid for.

He will come under pressure to either hike taxes or cut spending elswhere to increase that funding further, having resigned as defence secretary ahead of publication of the Dip, arguing it did not provide enough money for the armed forces.

Andy Burnham, who is now in his 100th day in office, has also announced a string of policies to help people and businesses with living costs since he came to power that will need funding.

This week, a series of “everyday fixes” were set out ahead of the Budget to help people with the cost-of-living crisis, including replacing the Carers’ Allowance cliff edge, which has penalised unpaid carers for going over their earnings limit, with a taper system.