Cazenove: Coalition has made wrong choices on tax

George Osborne is taking a "severe risk" in putting the onus on taxpayers to reduce the £155bn deficit, according to Cazenove.

Richard Jeffrey, Cazenove's chief investment officer, says a renewed period of falling household spending will leave the wider economy "once again flirting with recession". He says the Chancellor was always going to face tough decisions in cutting the deficit to £116bn in 2011/2012. Raising VAT from 17.5% to 20% from January was the wrong one to make, Jeffrey argues. The Government should have taken fiscal measures first, he argues, especially "at a time when the general economic environment is not helping households, and all the monetary policy levers have already been pulled." ...