One of the frustrations for chancellor Philip Hammond is the way that tax revenues do not appear to match the apparent increase in GDP, exacerbating problems in the public finances. In last week's Autumn Statement the ‘eye-watering' increase in public sector debt was put down to ‘a weaker economic outlook weighing on receipts from income taxes'. The Office for Budget Responsibility said that even before Brexit, borrowing was rising ‘thanks mostly to weak income tax receipts'.

This is down to various reasons. Although the UK has high levels of employment it also has low levels of productivity meaning that the jobs are either low paid or that wages are stagnant and the income tax they generate is therefore weak. Rising inflation caused by the fall in the pound will further erode the standard of living while sluggish productivity and lack of private sector investment means even weaker income tax receipts. The Government has also steadily reduced tax on the lower paid; in the last Parliament four million people ceased to pay income tax altogether.