IMF Singles Out Britain’s Deficit Plan Before the Budget
Kristalina Georgieva said Britain is “one country where action to reduce debt and deficit has been taken decisively”, the third such endorsement from senior IMF officials in a day. The fund lifted its growth forecast for this year to 1.3%. The chancellor is reported to be preparing a crackdown on VAT dodging through online marketplaces.
Praise from Washington’s fiscal watchdog is also a constraint. The IMF finds only Britain in the G7 with a serious plan to cut annual borrowing — worth nearly 4% of national income — while America, Germany and Japan borrow more; the reward could be lower relative borrowing costs. It leaves John Healey little room on 28 October, and the Institute for Fiscal Studies warns the Budget risks being a “work of fiction” unless it covers £35bn of spending pressures. The marketplace plan, reported by The Times and said to raise up to £1bn, would make platforms collect VAT for sellers above £90,000 to fund business-rate relief. Amazon welcomes it; the Treasury will not comment.