More tax cuts to come, Sunak vows as Budget day draws closer

RISHI Sunak said there is ‘more to come’ in terms of tax cuts as he and the Chancellor prepare to start drawing up their Budget next week.

The Prime Minister reiterated yesterday that he wants to slash taxes ‘when we can responsibly do so’, echoing comments made by Jeremy Hunt this week.

Mr Hunt is expecting forecasts from fiscal watchdog the Office for Budget Responsibility in the coming days, at which point he is likely to sit down with the PM to enable them to plan tax cuts on March 6.

A Treasury source said last night: ‘Once we know what headroom we have, we can start piecing the Budget together.’

Yesterday, Mr Sunak said last year’s Autumn Statement had delivered a ‘ tax cut for 27million people in work’.

Speaking on a visit to Eastleigh in Hampshire, he added: ‘And we do want to cut taxes for future events when we can responsibly do so.

‘Our priorities are very clear. It is controlling spending and welfare so that we can cut people’s taxes.

‘The plan is working, because we are already doing it. Stick with it and there is more to come.’

Mr Hunt cut the main rate of national insurance from 12 per cent to 10 per cent in his Autumn Statement last year at a cost of about £10billion.

With an election expected later this year, the spring Budget will be one of the last opportunities for ministers to announce tax cuts.

There is speculation as to whether the Chancellor could cut the national insurance rate further, reduce income tax rates, unfreeze income tax thresholds, or target inheritance tax and stamp duty.

Speaking earlier this week from the World Economic

‘Our priorities are very clear’

Forum in Davos, Switzerland, Mr Hunt said that lowering taxes was the ‘direction of travel’ for the UK. ‘ The economies that are growing faster than us – North America, Asian economies – tend to have lower taxes,’ he said. ‘So that’s the direction of travel we’d like to go in, but it’s too early to know the extent to which we’ll be able to do it.’ Tax levels are at a 70-year high and the overall tax burden is still rising due to frozen income tax thresholds. The

Prime Minister and Chancellor are under pressure from their party to reduce taxes to give the Conservatives a chance of winning the next election in the face of a huge lead in the polls for the Labour Party.

Mr Sunak has said that he is planning to go to the country in the second half of this year, fuelling speculation that November 14 could be polling day.

Mr Hunt has also left open the question of whether there will be an additional Autumn

Statement on top of the March Budget before the general election is called.

Asked if his priority would be tax cuts for businesses or for households, the Chancellor insisted he did not draw such a firm line between the two categories.

Mr Hunt highlighted how the national insurance cut he announced in November was expected to boost the workforce and also help fill vacancies, as well as easing pressure on families.

‘What I can assure you is that we will prioritise economic growth,’ he added.

‘I don’t make quite the same distinction as you do between business tax cuts and personal tax cuts.’

He said Britain was required to hold two ‘fiscal events’ in a year, adding: ‘We will see where we get to after the spring.’