Sunak accused of U-turn on tax cut
RISHI Sunak has come under fire for “flip-flopping” on tax after pledging to cut VAT on energy bills and interrupting his rival Liz Truss in Tory leadership debates.
It came after the Tory leadership hopeful unveiled plans to remove VAT from domestic energy bills for a year if the price cap currently just under £2,000 a year for the average home - exceeds £3,000 as is forecast by experts.
But critics pointed to Mr Sunak’s repeated denunciation of Ms Truss’s offer of unfunded tax cuts he has described as “comforting fairy tales”.
Business Secretary Kwasi Kwarteng said his plan amounted to a U-turn, which, alongside Mr Sunak’s handling of the TV clashes, was a sign he is under pressure in the race for No 10.
Mr Kwarteng, a senior ally of Ms Truss, told Times Radio: “I think he’s under a lot of pressure.
“That’s why we see all these statements: he was the person who said the VAT cut would disproportionately benefit rich families and now he’s saying that a VAT cut on energy bills is the right thing.
“He was saying that tax cuts were a fairytale, now he is proposing an unfunded tax cut.
“There comes a time in campaigns when people are under a lot of pressure, he clearly felt under a lot of pressure in the debate and he wanted to get out on the front foot and interrupt Liz.”
Asked whether Mr Sunak could win a general election, Mr Kwarteng told LBC radio: “He has flip-flopped and U-turned on this tax issue, which I find somewhat concerning, but he is a capable politician and a very likeable chap.”
Mr Sunak rejected calls in February for a VAT cut to energy bills, telling the Commons “there would be no guarantee that suppliers would pass on the discounts to all customers”.
Criticism also came from the opposition, with Shadow Treasury Minister Pat McFadden accusing him of “acting as his own personal rebuttal unit” and Liberal Democrat Treasury spokesperson Sarah Olney saying “this sounds like another Sunak Swindle”.
But the former chancellor’s campaign team said his new “winter plan” to tackle inflation and the cost-of-living crisis stands in contrast to the inflationary £55 billion of fiscal commitments Ms Truss has made.
Transport Secretary Grant Shapps, a supporter of Mr Sunak, defended the Mr Sunak’s £4.3 billion policy as sensible as it would not add to inflation.
“In the short term it would be deflationary because people’s costs would reduce, in the medium term it would not have an impact on the consumer prices index,” he told ITV’s Good Morning Britain.
Mr Sunak said about his proposals: “This additional VAT cut will help deal with the current emergency.
“I will also begin undertaking major supply side reforms targeted at the rising cost pressures families are facing.
“That means urgently getting more people off welfare and into work and tackling the supply chain crunch”.