We’re likely to hear a lot about the chancellor’s “headroom” in this Budget.
That is the cash buffer the government has to help meet its own fiscal rules and reduce borrowing.
Economists think the buffer might have halved in the last six months from around £24bn to as low as £11bn, in part because of rising interest rates the government has been paying to borrow money from private investors.
The Chancellor, John Healey, might need to raise money to restore it, which would show the government’s plan to reduce borrowing by the end of this Parliament is still on track.
At the same time, he is under pressure to find money to help people with the rising cost of living and to fund spending on defence. However, Labour’s 2024 election manifesto pledged not to raise the rates of income tax, VAT or National Insurance.
Increasing taxes on capital gains or extending the mansion tax had been raised as possible options but have since been ruled out by government sources.
Verify has looked at what other options could be on the table for the chancellor to raise some more money, external on Wednesday.