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Friley.

Hello and welcome to Coffee House Shots, the Spectator's Daily Politics Podcast. I'm

Oscar Edmondson and I'm joined today by Tim Shipman and James Heel. Now, it turns out that after

all the kite flying and all that briefing, there won't, in fact, be an income tax rise in the budget.

James, what the hell has gone on here? It's a very good question.

As one person in Labour said to me today, they've managed to roll the pitch, unfortunately,

it's the wrong one.

What's happened here is that the Financial Times overnight broke the story that actually,

despite all the pre-referring suggesting that there was going to be a right in income tax,

something we were very confident at the beginning of this week.

Turns out there isn't going to be an expected rise in income tax. There may be some looking at some of the thresholds. And then this sort of got out. And suddenly the market's reacted quite badly because the sense was that at least with the tax rise, you know it's a guaranteed revenue raise. So if you do, if you increase income tax by 2P and you cut national insurance by 2P, you should raise about 6 billion.

So that's quite... least with the tax rise, you know it's a guaranteed revenue raise. So if you do, if you increase

income tax by 2P and you cut national insurance by 2P, you should raise about $6 billion. So that's quite a bankable $6 billion. Then the story then broke by Bloomberg, which was that actually the early sign suggests they got more fiscal hedrums. So rather than a 30 billion black hole, it's closer to $20 billion. And therefore, they wouldn't have to go ahead with this income tax rise. Actually, it was a good sign that things are healthier than otherwise. So that seems to be where out. But unfortunately, the markets are all over the place currently because they low the instability. And of course, this is not normal. We always get a bit of volatility and pre-briefing before budgets. But this level, this is so close, only about 10 and 11 days from the budget, is not normal. So what we think now is that actually there isn't going to be income tax rise, but they are going to look at things like thresholds. My old mate Matt Chawley at the times used to say this is not normal every single week during the Brexit years, but we are very much back into that terrain, aren't we? It's good news, we're told. The OBR has announced that they've

got more headroom. But this just shows the utter farce of this process, the fact that they are

dependent on, you know, weekly updates from the OBR. And in the approach to budget, I think they get

the last one about five days before, and having had, you know, a different number every week for

six weeks.

This is a process now which is in serious question.

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