The Institute for Fiscal Studies (IFS) has urged Rishi Sunak to use the March Budget as a way to map out economic recovery from the \u201ctriple challenges\u201d of Brexit, Covid, and the move towards Net Zero.\r\n\r\nIn what is set to be the chancellor\u2019s second budget since his appointment, the IFS has suggested that Sunak does not raise taxes to make up for the \u00a3400bn borrowed during the pandemic, but instead \u201ccommit to permanent spending rises or tax cuts\u201d.\u00a0\r\n\r\nWith the budget set to be announced on 3 March, the group has also called on Sunak to provide better support for households and employers - with the IFS stating that covid support measures should be \u201cphased out gradually rather than coming to an abrupt halt\u201d.\u00a0\r\n\r\nSpeaking on the Employee Job Retention Scheme which has been extended to April 2021, the IFS said that furlough should not \u201cbe cut completely in one go\u201d or \u201cextended much beyond the point at which most restrictions are eased, otherwise it will actually choke off recovery\u201d.\u00a0\r\n\r\nIFS director Paul Johnson added that Sunak needs to \u201cstrike a balance\u201d between continuing support for jobs and businesses harmed by lockdowns, and weaning the economy off \u201cblanket support which will impede necessary economic adjustment\u201d.\u00a0\r\n\r\nHe said: "In the recovery phase he needs to support jobs and investment, but also crucially needs to recognise and address the multiple inequalities exacerbated by the crisis. Fiscal policy should lean against the effects of looser monetary policy which has again benefited the older and wealthier at the expense of the younger and poorer.\r\n\r\n\u201cAnd he will need to allocate substantial sums to help the health, education, justice and local government systems deal with ongoing consequences from the pandemic.\u201d\r\n\r\nHe added: "In all this, he is facing huge economic uncertainties as the economy adjusts to the triple challenges of Brexit, recovery from Covid and the move to Net Zero. It is possible that that growth will be fast enough that big fiscal deficits will largely dissipate of their own accord.\u00a0\r\n\r\n\u201cBut that is not a central expectation: more likely we are on track for ongoing unsustainable deficits. For now, Mr Sunak needs to focus on support and recovery. A reckoning in the form of big future tax rises is highly likely, but not as yet inevitable."