Osborne under pressure to come clean on tax reform impact

Chancellor George Osborne has come under fire from the influential Treasury select committee for failing to produce adequate analysis of the impact of Budget welfare and tax reforms, the FT reports.

Prior to parliamentary recess, the committee asked the Chancellor to produce figures on the impact of tax reforms on the rich and the poor. This has been done since in every Budget since 2010.

In a letter responding to TSC chairman Andrew Tyrie in July, Osborne said: “The Treasury will not be producing analysis of this kind for future fiscal events, because it presents spending funded by additional borrowing as an unequivocal gain to households, and measures to reduce borrowing as an unequivocal loss.

“That is plainly not a useful way to consider the distributional impact of economic policy, when we know that without sound public finances there is no economic security for working people, and that those who suffer when governments run unsustainable deficits are not the richest but the poorest.”

However, in response Tyrie said: “The committee has not heard any good reason why parliament should not see the analysis on the same basis as before.”