Market comment - Sunak’s budget to put off difficult choices for now

Davy Research
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Tomorrow’s UK Budget looks set to be as focused on extending COVID-19 supports such as the furlough scheme and stamp duty holiday as signalling tax rises will be required to eventually bring down the deficit. The decision to raise corporation taxes and freeze income tax thresholds will garner attention. However, the Office for Budget Responsibility (OBR) will still likely forecast a deficit of 7-8% of GDP in 2021/22, with net debt rising close to 110%.