Rishi Sunak plans to raise taxes now and cut them before next election
Rishi Sunak is reportedly planning to raise taxes in the autumn budget with a view to cutting them just in time for the next General Election.
Sunak met with Boris Johnson last week to plan the government’s fiscal response to the debt wracked up during the coronavirus crisis, with tax rises set to hit the UK’s wealthiest.
There has been speculation over the past week that the Tresaury was preparing a swathe of tax hikes to fund this year’s predicted £350bn deficit – 12-times higher than expected pre-Covid.
The leaks have caused consternation from many Tory MPs, members and right-leaning think tanks.
The Sunday Times reports that Sunak has convinced Johnson of the necessity to raise taxes to fill the budget black hole and that he will aim to cut them in time for a potential 2024 election.
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The move will reportedly see tax rises on inheritance tax, capital gains tax and corporation tax.
Insiders say that Johnson will not countenance having any of income tax, VAT or national insurance raised, after he pledged in the 2019 Tory manifesto to have a “triple tax lock” on these three taxes.
Number 10 also ruled out an increase in fuel duty this week, after speculation it could rise.
The plan to raise taxes now with a view to cutting them before an election will be seen as a way to placate Tory backbenchers, after former cabinet minister David Davis said he would vote against a budget that includes tax rises.
Labour has also come out against potential tax rises, with shadow chancellor Anneliese Dodds saying it “would choke off our national recovery at the moment when the economy is at its weakest, just so they can cut taxes before the next election”.