No tax rises as Brown can borrow £70bn

Link: Tax hikes on the way, says ITEM club

A huge shortfall in the income expected from corporation tax, and ambitious public spending promises has left Brown with a huge hole in his coffers.

As a result experts across the board were predicting further tax rises to fill the gap.

But Treasury officials say that unexpected revenues earned from tax in previous years means there is a surplus of £50bn since the beginning of the economic cycle in 1999. Combined with a further £19bn surplus for the remaining two years of the cycle Treasury officials insist Brown can still meet his rules.

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