Robbing Peter To Pay Peter - Roger Bootle´s Comment On The 2007 Budget

This was a bold, and indeed a big, budget but its impact on the economy will be minimal. It was designed to make a political, rather than an economic, impact, and in that regard it was brilliantly structured to make life extremely difficult for the Conservatives.

It pivots around two major headline-grabbing measures – the 2% cut in corporation tax and the 2% cut in the basic rate of income tax. But each of these was offset by revenue raising measures which almost exactly financed the cuts – the reduction of various allowances against corporation tax and the abolition of the 10p starting rate of income tax.

As a result, although there will be some companies and some individuals who will lose out and some who will gain, a very large number will be left in pretty much the same position as before.