Economists warned the next prime minister will face one of the bleakest financial backdrops since the 1950s.
Sluggish economic growth and high national debt mean there may not be enough money to fund existing public services.
The Institute for Fiscal Studies called on party leaders to be honest about the scale of spending cuts or tax rises ahead.
IFS director Paul Johnson said those looking to form the next government should be “honest about these trade-offs” and “if they are promising tax cuts, let’s hear where the spending cuts will fall”.
Prime Minister Rishi Sunak and Chancellor Jeremy Hunt have dropped hints about tax cuts featuring in the spring Budget in March.
But the IFS said that while the prospect of further giveaways might be tempting in an election year, it will risk a future tax hike or reductions in public spending.
Both Labour and the Conservatives have also promised to cut debt as a fraction of national income, but this will be much harder to achieve than in recent years amid high debt interest payments and low expected growth, it warned.
“On one measure, it will be more difficult to reduce the debt-to-GDP ratio over the next parliament than in any other parliament since the 1950s,” the report says.
The 1950s saw a debt-to-GDP ratio of around 200% – about double what it is today – after public debt increased rapidly during the Second World War.
A new government will inherit taxes at record levels, stagnant living standards and struggling public services, yet Government spending plans suggest further cuts to areas other than health, the report says.
The UK is on course for a £20 billion reduction in funding for services that are not ring-fenced, the IFS said.
“These challenges – unlike a conflict, pandemic or financial crisis – are entirely predictable,” it said.
“None can be meaningfully confronted by a government that wilfully ignores reality and the need to choose between difficult competing options.
“As tempting as it may be to engage in ‘cakeism’ – to seek to have the government’s fiscal cake and eat it – any party serious about governing after the election should resist the urge. The electorate surely deserves better than that.”
A Treasury spokesman said: “Our decisive action to halve inflation and ensure debt falls as a share of the economy means we are now beginning to turn a corner, which is why we can afford tax cuts for 27 million working people this month.
“The best way to deliver sustainable funding for public services in the future is to grow the economy – the UK has grown faster than France, Germany and Japan since 2010 and the OBR say our action in spring and autumn will deliver the largest boost on record.”
