Be prepared for change. Unless Rishi Sunak is elected leader of the Conservative Party as his determination to increase taxation, control government expenditure and reduce borrowing is the present general direction of economic policy.
But from early September 2022, this may change if one of the other candidates pips Rishi to the Prime Minister post.
Then, we may see reductions in taxation – particularly reversing the recent NIC increase and the intended increase in corporation tax next year. The emphasis would be to stimulate investment and economic activity by increasing business and personal net of tax income.
However, will we be encouraged to speculate any increase in cash flow or will we squirrel away any increase in bank balances, just in case…
COVID is still a possible disruptive influence as is the war in Ukraine and unresolved Brexit issues. Added to which, how far will the Bank of England need to increase interest rates before inflation is bought under control?