Redwood’s concern over windfall tax

SIR John Redwood is not in favour of a windfall tax on energy companies, instead calling for tax cuts.

The Wokingham MP wrote on Twitter that he felt the move by the chancellor was “bad economics and worse politics”, adding that it had been right for MPs to vote it down.

“It will further our decline in the world tables of good places to invest,” he said.

Writing in his blog last week, he went further with his criticism of the policies announced by the chancellor that will see every home receive a £400 rebate in their energy bills ahead of the autumn increase in the price cap, which is expected to rise to £2,800.

“(The Chancellor’s) taxes make the cost of living crisis worse,” he wrote.

“Instead of taking down taxes on oil and gas heating and petrol which would have reduced inflation he went for the route of oneoff payments to people.

“Had he done more to cut inflation it would have cuts his costs more, many of which are boosted by higher inflation,” he added.

“He did not quantify the large amount of extra tax he must be collecting on energy profits and sales given the huge price rises.”

And Sir John was also critical of the chancellor’s decision to the “printing of another £150 billion of new money for a strong recovery year”.

“I asked him if he thought at the time that could be inflationary. “He did not have an answer. “I also pointed out he guaranteed the Bank against all losses on the bonds they bought, as his predecessors did.

“I asked him about the impact of the losses they must now be making.

“Again no answer.”