Budget: Rishi Sunak signals tax hikes necessary amid ‘extraordinary’ borrowing levels

Chancellor Rishi Sunak has sent a clear signal of tax hikes in today’s Budget, telling the cabinet that it would not be “right or responsible” for the government to ignore the fact that borrowing is at “extraordinary” levels.

Setting out his Budget plans to cabient colleagues shortly before addressing MPs in the House of Commons, Mr Sunak said he would use the package to provide support to help ‘get people through to the other other side of the crisis”.

But he warned that borrowing had risen to levels previously seen only in wartime and the government must be “honest” about the belt-tightening that would be needed to rein in debt.

A Downing Street spokesman said: “He said that the coronavirus pandemic has hit our economy hard. We've stepped in to provide support and protect jobs and today we will outline more support to get people through to the other side of the crisis.

“The chancellor said we must be honest with ourselves and the country about what that has meant. We are borrowing on an extraordinary scale - equivalent only to wartime levels.

“He said that, as a Conservative government, we know that we cannot ignore this problem and it wouldn't be right or responsible to do so.”

The spokesman added: “The chancellor said that, while we face challenging times, we will rise to that challenge and we can be optimistic about the recovery. He said the Budget will begin the work of building our future economy.”

Boris Johnson told the cabinet that the government would set out a plan for growth, focusing on innovation, skills and infrastructure, to “unleash the potential” of the country following the pandemic.

“He said the Budget would begin to set out how the country will make the most of our post-Brexit future and as a science superpower,” said the No 10 spokesman.