UK taxes have reached 1948 levels – but the contrast between the budgets is stark

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In 1948, the country was in the midst of reconstruction following the second world war – and had the tax levels to show for it. Ration cards were still in use and the NHS still on the maternity ward, having been born that July. The previous month, the Empire Windrush had made its historic arrival in Tilbury. Earlier that year, Myanmar and Sri Lanka – then named Burma and Ceylon – had gained independence from the British empire. And, in the summer, Portsmouth ascended the summit of domestic football for the first time – winning the English title. Pompey have only hit that height once more in the subsequent 76 years. As has the amount of tax we pay – this week. According to official forecasts, the offsetting of a second successive 2p cut to national insurance with a series of small tax increases elsewhere in Wednesday’s budget have left tax as a share of national income at 37.1%. Among those stealth increases were taxes on vaping, tobacco, holiday home lets, business class flights and non-doms. Reporting on 1948’s budget by the chancellor of the day, Labour’s Stafford Cripps, the Guardian said: “The real interest in the budget proposals is to discover whether the heavy worker who likes a smoke and a drink will feel benefit from the income-tax concessions, or will find himself financially to be just about where he is now. This is an elaborate sum to work out. Against income-tax reliefs must be set extra duties on beer, spirits, and tobacco.” In 2024, it is a Conservative chancellor, Jeremy Hunt, hoping voters will begin to feel the benefits of his economic tinkering – and perhaps not notice too keenly increases in what could be termed lifestyle taxes. Hunt will also be hoping not too many voters will be put off by the clear implication that any pre-election giveaway will be balanced out by post-election cuts to public spending. With polls suggesting voters see the state of the UK’s public services – as well as the economy – among the top issues facing the country, Hunt has perhaps seen the political imperative in postponing any cuts he believed necessary until after the general election. According to the Resolution Foundation, they will be huge. “This rising tax burden, alongside post-election spending plans, will leave a sour taste for whoever is in office at that point,” it said on Wednesday. The thinktank suggested the chancellor was planning cuts to government bodies such as the Ministry of Justice, the Home Office and local government of £19bn a year. To put that into context, between 2024-25 and 2028-29, such cuts – expressed per person – would be about three-quarters the levels seen during the Tory-led austerity drive from 2010-11 to 2014-15. Rewind to the budget of April 1948, and Cripps had a very different take. “We have, I think, done everything practical to make as large a contribution as possible by economy of government expenditure. We do not propose to cut the social services, as that is not in our view a fair or a desirable thing to do. We are proud of our record on the social services, and are anxious to improve on it,” he told the Commons. The Guardian reported that year that “the April budget [would] be a severe test” for the government in which Cripps served. But Cripps and his Labour party had another three years before they had to go to the country. Hunt and the current crop of Tories have only a few months.