Javid and Hunt call for massive cuts to taxation

♦ Former chancellor wants to scrap National Insurance tax rise ♦ Help for large and small businesses the priority for former foreign secretary

SAJID JAVID and Jeremy Hunt today put tax cuts at the heart of the battle for Downing Street as both MPs declare their candidacies in The Sunday Telegraph with pledges to slash corporation tax.

In separate interviews with this newspaper, the Tory leadership contenders both say they would cancel Rishi Sunak’s planned rise in corporation tax, and instead reduce the proposed 25 per cent rate to 15 per cent.

In a bombshell announcement, Mr Javid also states that he would scrap the controversial National Insurance hike, which was introduced during his time as health secretary to fund the NHS and social care. In an apparent attack on Mr Sunak, his rival for the leadership, Mr Javid says: “I’m not sure I would have done it if I had been chancellor but I was focused on my job and I’m not trying to do other people’s jobs for them.”

Writing in this newspaper, Simon Clarke, the Chief Secretary to the Treasury, reveals that he is backing Liz Truss to become leader and that “she would reverse the NI rise, returning to the Conservatives’ manifesto commitments and incentivising job creation”.

Mr Javid, a former chancellor, uses his interview to set out an economic plan that also includes bringing forward the planned 1p income tax cut to next year, and a further temporary cut to fuel duty.

While Mr Javid would cut corporation tax by 1p per year to reach 15p, Mr Hunt pledges to immediately slash the 19p rate to 15p in an autumn budget.

Mr Hunt, a former foreign secretary, also sets out a plan for a five-year business rates holiday for the most deprived parts of the country, many of which are in the so-called red wall.

He criticises Boris Johnson’s levelling-up agenda for being “far too New Labour” – focused on high-spend infrastructure projects rather than “wealth creation”.

Both men implicitly criticise Mr Sunak’s record as chancellor, with Mr Javid also taking aim at his rival’s insistence that tax cuts should be put on hold until the economy improves.

Meanwhile, also writing in this newspaper, Gerard Lyons, Mr Johnson’s former economic adviser, backs Penny Mordaunt as the best candidate to “focus on growth” and “truly champion the UK”. Dr Lyons, who is now advising Ms Mordaunt, suggested that she would also cancel the planned corporation tax increase, and cut fuel duty.

Yesterday, Ben Wallace, the Defence Secretary, ruled himself out of the leadership contest despite topping a poll of party members, while Priti Patel, the Home Secretary, was said to be under pressure from some Brexiteers to stand.

Would-be candidates only have until Tuesday night to gain sufficient backers to enter the contest, with nominations opening tomorrow evening after the election of a new 1922 Committee.

Yesterday, a slew of Tory MPs announced their allegiance to declared candidates as Mr Sunak took a firstmover advantage following the announcement of his campaign on Friday. Simon Hart, who quit as Welsh secretary last week, backed Mr Sunak, while Brandon Lewis, the former Northern Ireland secretary, publicly lent his support to Nadhim Zahawi, the new Chancellor.

In a broadside at Mr Sunak, Mr Javid said: “Our tax rate now is already almost a 70-year high – and that’s happened under the Conservatives. I think that troubles a lot of people. And so I think a prerequisite for growth is tax cuts.

“There are some that say that you can’t have tax cuts until you’ve got growth … that is fundamentally flawed analysis.”

Mr Hunt, however, insisted being able to cut taxes did depend on growth, saying: “I would love to see income tax cut, but it has to be done in a way that is sustainable.

“It can’t be an electoral bribe and it depends on growth. What you’d need is an income tax cut that is for life, not for Christmas. That means starting by saying we’re going to get the economy growing, then you get yourself in a position.”

Mr Hunt, who was health secretary for six years before moving to the Foreign Office, said he would keep the NI increase in place. He said: “The NHS needs the money.”

Mr Wallace said his decision not to stand had “not been an easy choice to make” but that his “focus is on my current job and keeping this great country safe”.

Last night, Mr Sunak had 19 backers, while Suella Braverman, the Attorney General, and Ms Truss had nine each.

Kemi Badenoch, the Brexiteer equalities minister, who sets out her stall in an interview in this newspaper, has received the backing of several socially conservative MPs including Lee Anderson, Tom Hunt and Ben Bradley.

Sir John Hayes, Richard Drax and

Philip Hollobone, all Boris Johnson loyalists, have announced their support for Mrs Braverman. Mr Sunak yesterday revealed the first policy proposal of his campaign was to crack down on gender-neutral language, as he told supporters: “We must be able to call a mother a mother.”

His team has already attracted the support of 10,000 online supporters after his campaign video went viral.

Sources close to Ms Truss yesterday suggested she was almost ready to announce her own candidacy after preparations were delayed by an illtimed G20 visit to Indonesia. Writing in The Telegraph today, Mr Clarke said that one of Ms Truss’s core policies will be to cancel the £12billion NI hike.

“People know what to do with their own money better than any government,” he writes. “Liz understands this, which is why she would move swiftly to simplify and cut taxes in order to put more money back in their pockets and ease the cost of living.

“She would reverse the National Insurance rise, returning to the Conservatives’ manifesto commitments, and incentivise job creation.”

Mr Zahawi and Grant Shapps have become the latest MPs to throw their hats in the ring, bringing the total number of declared candidates to seven.

Senior party sources expect the total number of runners could be as high as 16, and are planning a high threshold of nominations to whittle the list down to “serious candidates” quickly.

In an interview with this newspaper, Mrs Badenoch expresses concerns that the Government’s flagship Online Harms Bill risks criminalising factual statements about biology and sex, describes herself as an “aid sceptic” and says the “arbitrary” net zero target was ill-thought through.

She is standing for the Tory leadership on a platform of “lighter, simpler, nimbler government” and expressed fears that some MPs have become hooked on the idea of the state fixing the majority of problems.

The former Treasury minister also takes aim at the Government’s handsoff approach to the Bank of England over inflation, stating: “I don’t think we should stop the Bank of England being independent, but we do actually have to mark their homework … If we had been marking their homework, we would have spotted the issue around inflation earlier and done something and probably would have had a different approach.”

Meanwhile, Mrs Braverman also pledges tax cuts, stating: “We must get government spending under control. We must slay the inflation beast. We need to cut VAT on energy, and reduce the planned tax increases that are already putting off future investors.

“Ministers and officials must remember that every pound they spend has to come out of your pocket first. And just because millions have been spent on a project does not mean we should keep pouring good money after bad. We need a relentless focus on transparency and measurable performance – whether in hospitals, police stations, or schools. Projects that cannot be measured in terms that matter to ordinary people should be scrapped.”