Whoever wins the general election on 4th July will have three main choices when it comes to spending and taxes. First, the new government could change the fiscal rules to give itself more fiscal space. Second, it could keep the current fiscal rules and stick to the existing plans to trim unprotected spending in real terms, despite not being politically appealing, and keep taxes as scheduled. Or third, it could retain the current fiscal rules but change the composition of fiscal policy. In other words, given the fiscal constraints, if it wanted to increase spending then taxes would need to be higher. If the new government chose the latter, which taxes could be raised?
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