£40billion of extra tax per year warning

TAX hikes of more than £40billion a year may be needed to prevent Government borrowing spiralling out of control, an economic think-tank warns.

The Institute for Fiscal Studies says borrowing this year is already set to hit levels not seen outside the two world wars.

Paul Johnson, IFS director, said Rishi Sunak should not “worry unduly” about debt now due to the low cost of borrowing.

But he added: “None of this will be enough to protect the economy into the medium run.

“Tax rises, and big ones, look... inevitable, though likely not until the middle years of this decade.”