Up until the last few minutes of his second budget it was hard to distinguish Rishi Sunak from a giveaway chancellor of yesteryear. The hour-long address was peppered with spending pledges on everything from schools to prisons, from theatre refurbishment to community football pitches.

Then, as the peroration approached, the real Sunak emerged as he launched into a statement of his belief in a Britain where taxes are lower and the state is smaller. The chancellor could hardly have been clearer: he intends to get taxes down before the next general election.

Sunak felt the need to provide his colleagues with some reassurance that the spirit of Margaret Thatcher was alive and well in the Conservative party because – as the Office for Budget Responsibility noted – his two budgets this year have raised taxes by more than any chancellor since the two Norman Lamont and Ken Clarke budgets in 1993.

To be sure, there were tax cuts in the budget – the crowd-pleasing cuts in alcohol duties, the customary freezing of fuel duties for motorists, and a business rate discount for the hospitality, retail and leisure sectors among them.

But these followed two whopping increases in taxes already announced – the post-dated increase in corporation tax in March and the rise in national insurance contributions announced in September. The result is that taxes as a share of national output are the highest since the 1960s while spending is back to levels last seen in the late 1970s.

Sunak is able to offer more spending now while promising tax cuts later because the economy is doing better than the OBR envisaged in the spring. Growth is higher and – crucially as far as the public finances are concerned – the estimate of the amount of long-term damage to the economy caused by the pandemic has been reduced. That gave the chancellor more scope to be generous, which he exploited.

What could go wrong? Well, apart from a new wave of the pandemic, the risk is that the economy slows and inflation picks up. Stagflation in other words: another reminder of past budgets.