Tim Thorlby’s Post

Good afternoon from New Economy Brief. The new government outlined their legislative programme with 40 bills in last week’s King's Speech. Among them is the Budget Responsibility Bill which forbids the government from making any “significant and permanent tax and spending changes without an accompanying independent assessment from the Office for Budgetary Responsibility (OBR)”. This week’s New Economy Brief explores the role the OBR plays in our political and economic debate, and asks whether a modest tweak to the ‘fiscal lock’ could ensure proper scrutiny of the government's plans in relation to longer-term risks to the public finances from underinvestment and climate change: https://lnkd.in/eNacKjCm

Last week the EU defined a new set of fiscal rules. Why does this matter?: 🔈 Because a solid fiscal framework aiming with healthy public finances is crucial for the functioning of our euro. If the public finances of one or more member states derail: it can lead to a member states’ exit or the ECB will have to come to the rescue with taxpayers money.  🔉 It matters because, currently 13 of the 27 EU member states have debt ratios exceeding 60% of GDP. Take for example Belgium - the current presidency of the European Council. It has a debt ratio of 106% and an annual deficit in excess of 3% of GDP. Without any policy changes they will end up with an annual deficit of 5.6% and debt of 116,8% in 2029.  ➡ What we need? Healthier public finances, a sustained drive for structural reforms and much needed investments.  ➡ Will these new rules be the real solution? Everything will depend on the Commission's toolbox and how hard they can sanction unwilling member states. Unfortunately, the past has learned that they favor personalized trajectories, compromise solutions and adjusted plans. This could become a tricky road

As the UK prepares for the 30 October Budget, there's much debate about whether the government should focus on raising taxes or boosting investment to close the deficit. While tax increases could generate short-term revenue, there’s a real risk of stifling economic growth, especially when businesses and individuals are already feeling financial pressures. Recent articles in the Financial Times have argued that strategic investments in areas like infrastructure, green energy, and innovation could not only stimulate the economy but also lead to higher tax revenues in the long run. Growth friendly policies may provide a more sustainable solution to the UK's economic challenges, helping to fill the deficit while supporting long-term prosperity. The question remains: should we see more taxation or a stronger focus on investment? The right balance could be key to avoiding deeper fiscal challenges. #UKBudget #Investment #TaxPolicy #PublicFinance #SustainableGrowth

Updated data from Bureau of Economic Analysis show real R&D investment contracted 2.9% in Q4 after falling 2.3% in Q3. On a year-over-year basis, real R&D investment fell 0.9%. This is the weakest year-over-year rate since 2010. It's time to pass the Tax Relief for American Families and Workers Act and restore important pro-growth tax provisions like immediate R&D expensing. Passing this bill would strengthen the economy, create jobs and increase America's competitiveness. Learn more: https://bit.ly/3Uf3EJk

With changes to fiscal rules, an increase in taxes and potentially more government investment, this Budget is the most important in years. Overall, our economist Thomas Pugh doubts it will upset the economic recovery currently underway and it could set the stage for a much-needed increase in investment. His one area of concern? If done badly, there is a risk that business and consumer confidence is damaged, undermining the path to economic recovery. Read the full predictions, where Sheena McGuinness, Thomas Pugh, Kelly Boorman, Charlie Barnes and Chris Etherington share their thoughts here: https://lnkd.in/e4fxwAUT #AutumnBudget #Budget2024 #BudgetPredictions

The #InterimBudget lays down a roadmap for scaling the economy to USD 7 trillion by 2030 through Governance, Development and Performance. Here is a snapshot of the economic outlook along with the key tax and regulatory proposals made in the #budget2024. Download now: https://pwc.to/4byzarZ #Budget2024WithPwC #Budget2024

The Financial Times has developed an interactive game that allows you to step into the shoes of the UK Chancellor and make decisions on tax policy and spending to balance the budget. This year's budget will be a historic one with significant consequences from choices made. Even more relevant to consider the options available and the consequences of the choices. The game is an engaging way to help illustrate the impact of tax on the economic landscape and the challenges faced by policymakers. Let me know what you think after playing the game. https://lnkd.in/df-Sfq-F #UKBudget #TaxPolicy #deloittetaxandlegal

We know from research that cost of living has been the most concerning issue for Australians since the pandemic, yet little has been done to address this and the purchasing power of Australians is not due to return to what it was prior to the pandemic until well into the 2030s. With such a bleak outlook for regular people, the proposed tax cuts need to be reevaluated. Sure we all want to be better off economically, but do we really want fewer government services and funding of healthcare, education and public housing? Because lower taxes mean less money for governments to spend on social programs. Or are there better ways to address the cost of living crisis? These are complex issues that require detailed community discussions and the evaluation of evidence. This article by Emma Dawson at Per Capita Australia offers some important insights to get your thoughts going. OurVoice has created a space to have these conversations and invite you to join a community interested in discussing how to solve the cost-of-living crisis. You can join here: https://lnkd.in/gRZ4B8EN

Decoding Budget 2024: how economic factors and bond market dynamics shape fiscal policy. Every year, the Budget Speech commands wall-to-wall media coverage. Most of this coverage asks something along the lines of, “What does the Budget mean for the taxpayers, the economy, and markets?” Increasingly, this question should also be asked in reverse. How does the state of the economy and the bond market influence the Budget? Find out in the full article: https://buff.ly/3uKnZfe Don't forget to hit that like, share, subscribe, and drop a comment below! #Budget2024 #bondmarket #debtratio #deficit #fiscalconsolidation #fiscalmultiplier #GFECRA #governmentbonds #governmentdebt #interestrates #IzakOdendaal #NationalTreasury #noninterestspending #OldMutualWealth #primarybalance #SouthAfricanReserveBank #monnstoneinfo #moonstoneupdate #industrynews

The Importance of Fiscal Responsibility in Building a Strong Economy Discover how fiscal responsibility plays a crucial role in the growth of local economies and businesses. Explore the challenges faced by the state of Delaware, and learn about a proposed bill that aims to align government spending with the local economy for sustainable development. #FiscalResponsibility #LocalEconomyGrowth #BusinessDevelopment #SustainableDevelopment #DelawareChallenges #GovernmentSpending #EconomicGrowth #SmallBusinessOwners #Budgeting #EconomicStability