Britain will be condemned to five more years of austerity under plans set out in the Tory manifesto, with “big cuts” in spending causing serious damage to public services, the Institute for Fiscal Studies (IFS) has warned.
Theresa May’s vow to cut immigration to the “tens of thousands” also risks a £6bn hit to the public purse, the respected economic think tank said.
The IFS was equally scathing about Labour’s proposals, saying plans for tax hikes aimed at top earners and businesses may "not raise anything like" the £48.6bn.
Neither of the two main parties is presenting an "honest set of choices" to the public over their tax and spending plans, it said.
Under the Conservative’s plans, Britain would be subject to “at least another five years of austerity”, the body said, with “more spending cuts or tax rises even beyond the end of the next parliament” likely.
"The Conservatives simply offer the cuts already promised. Additional funding pledges for the NHS and schools are just confirming that spending would rise in a way broadly consistent with the March Budget,” said Carl Emmerson, deputy director at the IFS.
"Compared with Labour, they are offering a relatively smaller state and consequently lower taxes. With that offer come unacknowledged risks to the quality of public services, and tough choices over spending."
The Tory commitment to slash net migration risked causing considerable damage to the economy, particularly when coupled with the ageing British population, according to the IFS.
"Their continued focus on reducing immigration would, if effective, cause considerable economic damage as well as creating an additional problem for the public finances," Mr Emmerson said.
The Office for Budget Responsibility has already downgraded its forecasts for tax receipts by £6bn in 2020-21 - and rising thereafter - due to lower expected net immigration.
"Meeting the Conservatives' commitment to reduce immigration to the tens of thousands would hit tax revenues by a similar amount again," he said.
On Labour’s proposals, Mr Emmerson said the proposed increases in health funding were “modest”, with childcare and higher education the two biggest beneficiaries of boosted spending.
“For Labour we can have pretty much everything - free higher education, free childcare, more spending on pay, health, infrastructure,” he said.
"And the pretence is that can all be funded by faceless corporations and 'the rich'.
"There is a choice we can make as a country to have a bigger state. That would not make us unusual in international terms.
"But that comes at a cost in higher taxes which would inevitably need to be borne by large numbers of us."
Jeremy Corbyn’s blueprint for government would "raise spending to its highest level since the mid-1980s and tax to record levels in peacetime", he said.
“The Labour manifesto comes with two big risks. The first is that they might well not raise anything like the tax revenues they want from their proposed measures.
“The second is that some of the proposed tax increases, alongside the very big increase in the minimum wage, and other labour market regulation, would turn out to be economically damaging.
“For the Conservatives the big risk is that, after seven years of austerity, they would not be able to deliver the promised spending cuts either at all or at least without serious damage to the quality of public services.
“Their tight immigration targets would, if delivered, also damage the economy and the tax base.”
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