Chancellor George Osborne has warned that a vote to leave the EU would result in the UK’s GDP falling by more than 6 per cent.
In a letter published in The Times, Osborne said that the Treasury’s economic analysis showed that ever UK household would be annually worse off by £4,300.
Focusing on a Canadian-style relationship with the EU, that would see the UK negotiating a series of bilateral deals with Europe, Osborne said: “There would be enormous costs for our public finances, far outweighing the little over 1p in every £1 in taxes raised that we currently contribute net to the EU.
“There wouldn’t be more money to spend on the NHS, defence and the like; there would be far less. The conclusion is clear: for Britain’s economy and for families, leaving the EU would be the most extraordinary self-inflicted wound.”
It comes days after the Chancellor also warned that leaving the EU would also impact mortgage rates.
Speaking to the BBC last week, Osborne said: “The Bank of England is independent and it makes its decisions on interest rates.
“But the overwhelming view of the experts here in Washington is that if Britain leaves the EU, prices would go up and there would be instability in financial markets.”
He added: “That means it’s likely that mortgage rates would go up, families would pay the price of Britain leaving the EU.”
The UK will vote on EU membership on June 23.