[5] The institute's stated aim is "to provide top quality economic analysis independent of government, political party or any other vested interest.

The institute was founded in response to the passing of the Finance Act 1965, by four financial professionals: a banker and later Conservative Party politician (Will Hopper), an investment trust manager (Bob Buist), a stockbroker (Nils Taube), and a tax consultant (John Chown).

In Chown's words, the group wanted to ensure that "never again should a government, regardless of its political colour and intentions, introduce far-reaching tax legislation without the benefit of deep and thorough analysis of second- and third-order effects.

[7] In the same year an Executive Committee was formed, with Will Hopper as Chairman, Halmer Hudson as Secretary and Buist, Chown, Skinner and Taube as Members.

Simon Akam wrote in The Guardian in 2016: "Meade was assisted by two young economists: John Kay, who would go on to become director of the IFS, and Mervyn King, who would later become governor of the Bank of England.

[10] Areas of research covered by the institute include public finance and spending, pensions and saving, company taxation, consumer behaviour and poverty and inequality.

[11] Although most of the institute's research is UK-focused, recent work has also looked at international development policies, for instance at education and nutrition programmes in Colombia.

It also produces a peer-reviewed quarterly journal, Fiscal Studies, which publishes articles submitted by a range of academics and practitioners in the field.

The review was chaired by Nobel laureate James Mirrlees and included contributions from IFS staff alongside prominent economists from various universities around the world.

In October 2010, Deputy Prime Minister Nick Clegg accused the IFS of using methods that were "distorted and a complete nonsense",[18] after it challenged government claims that tax and benefit reforms in the June 2010 Budget were "progressive".

[20] In 2016, The Guardian said: "Some left-leaning economists look with particular scepticism on the claim that the IFS has no ideology, arguing that the institute holds an excessive faith in the power of market forces.

The tax campaigner Richard Murphy said the IFS was 'embedded in all the normal, standard pro-market assumptions that dominate conventional economic thinking in the UK and elsewhere'.

"[21] In July 2011, The Spectator published an article that said that "'institutes' funded by research grants (which means, usually, tax money) will always argue for more expensive meddling by the state" and that the Institute for Fiscal Studies was "the most striking example" of this.

[22] A week before the manifesto analysis for the 2019 UK general election was released, economist John Weeks commented that while the institute had no links to political groups, it had an inherent bias in its judgement criteria that "favour[ed] accounting balance over social outcome", saying that an IFS analysis cannot tell the public "whether a policy is a good idea, only whether the numbers add up.