The dynamic tax model

In March 2022, we announced the launch of our new dynamic tax model. Built in collaboration with economic consultants Europe Economics, the model predicts the dynamic impact of tax changes on the economy and wages; using official data from the Office for Budget Responsibility (among others).

 

TPA research director Duncan Simpson explains the dynamic tax model

 

Ahead of the 2022 Spring Statement, we used to model to predict that the health and social care levy could result in the UK economy being £24 billion smaller over ten years.

Moving forward, the model will be used by the TPA research team to forecast the results of future tax changes. As with any model which relies on estimates, the numbers won't be perfect; but they will give a clear indication as to whether tax changes could help or hinder growth or wages in the medium to long term.

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