Removing tax distortions from economic decision making should be encouraged. But simplifying the tax system has not been a key issue for the chancellor. Income redistribution has been. In the first half of this parliament public investment suffered badly. That famine is now being followed by a feast.
Public spending tends to be less cyclical than taxes.
Such investment may be well overdue, but the problem for public finances is that once unleashed it fight be much harder to contain. The immediate impact on the pound may be neutral, despite the chancellor's forecast of a harder time for exporters. Hence industry will turn its focus to the Bank of England. The gilt market will be content as the public finances appear sound for now and inflation is not an immediate problem. The business-friendly message from the chancellor and measures to cut business costs should be well received by the stock market.