Hunt considers £20bn of tax rises to fill nation’s black hole

JEREMY HUNT is considering up to £20billion of tax rises in the Hallowe’en Budget with high earners to bear the brunt of his quest to balance the books.

The Chancellor has been told by the Office for Budget Responsibility that there is still a £40billion black hole in the nation’s finances even after he reversed almost all of the mini-Budget.

He is looking to raise as much as half that from putting up taxes, reducing the need for painful and highly controversial cuts to public spending.

Mr Hunt could seek to reform generous capital gains rules and bring them more into line with general taxation, bringing in around £3.5billion a year.

He is also looking at ditching the twoyear removal of green levies from energy bills, which is being subsidised by the Treasury, and reintroducing them next April.

Liz Truss repeatedly hailed the move as one of her flagship cost of living policies and said it would save 28 million households around £150 a year.

The Chancellor is mulling dropping the Prime Minister’s commitment to increase defence spending to three per cent of GDP, saving £15billion.

That would leave him needing to find up to £15billion in tax rises, with Government sources saying they will fall on those with the broadest shoulders.

Mr Hunt is not considering measures that would hit the poorest Britons who are already struggling with rising prices, such as an increase in fuel duty.

He could find the money by reintroducing the National Insurance rise, which would raise £15billion, but that is politically highly unlikely.

The Chancellor could also revisit the plan to increase stamp duty thresholds, the only other measure to survive from the mini-Budget, finding £2billion.

One move, as called for by Labour, would be to abolish non-dom status which would bring in an extra £3billion a year to the Exchequer.

There are also a raft of wealth taxes Mr Hunt may look at, such as a council tax surcharge on properties worth over £2million that would raise £1.4billion.

He could adopt Sir Keir Starmer’s proposal for a further windfall tax on energy producers to drum up a further £8billion, though that would only be a temporary fix. Mr Hunt may keep the surcharge banks pay on their profits at eight per cent, meaning they will face an effective corporation tax rate of 33 per cent from April.

Rishi Sunak had promised to cut it to three per cent, but reversing his decision would raise well over £500million a year and be politically popular.