The UK’s economic growth ground to a virtual halt in July amid the pingdemic, as economists and Tory MPs warned that Boris Johnson’s £36bn tax raid threatens to further stifle the recovery.
Growth of just 0.1 per cent leaves the economy 2.1 per cent below its pre-pandemic peak during a month when the surging delta variant triggered a wave of absent workers and companies scrambled for raw materials amid global supply chain disruption.
The weakest growth for six months came after Andrew Bailey, the Governor of the Bank of England, warned MPs of “some levelling off of the recovery”, despite the lifting of pandemic restrictions on July 19.
Economists also warned of the impact of the Government’s latest tax grab on the economy as rises in National Insurance and dividend levies from next April are set to bring tax as a share of the economy to the highest since the Second World War.
Josie Dent, managing economist at the Centre for Economics and Business Research, added: “The upcoming end of the furlough scheme and termination of the £20 a week universal credit uplift also present risks to the recovery.”