- It is thought Hunt agreed to lower National Insurance for self-employed workers
- Braverman spoke to MoS exclusively & said party needs to demonstrate ‘low tax’
Jeremy Hunt will make a last-minute decision this week about whether to cut income tax.
Senior Treasury insiders said it is a call being made by the Chancellor and Prime Minister Rishi Sunak, with everyone else ‘locked out of the process’ before the Autumn Statement is presented in Parliament on Wednesday.
Mr Hunt has, it is understood, agreed to lower National Insurance for self-employed workers, but a decision about income tax was ‘going to the wire’ after more positive economic news about the economy this weekend.
The Chancellor, buoyed by a drop in Britain’s inflation to 4.6 per cent, gave a hint of tax cuts to The Daily Telegraph yesterday when he said that the economy has ‘turned the corner’ – until recent days he had been more concerned about the likely impact a cut in income tax would have on inflation.
However, despite widespread reports that inheritance tax will be slashed in the statement, this measure will not be introduced before the Budget or Election manifesto.
One well-connected MP claimed that the stories about the tax had been allowed to run unchallenged to distract attention from plans for the real tax cuts – which had only been discussed using codenames.
Another source said: ‘Any tax measure we introduce this week must boost supply in the economy – an inheritance tax cut would not do that.’
Mr Hunt remains cautious about slashing personal tariffs before the March Budget due to the cost of paying for higher interest charges on the national debt, in addition to the bill for funding the triple lock for state pensioners – but he is conscious of the pressure growing from Tory MPs for an ‘offer to voters’ in a bid to catch up to Labour in the polls.
Whitehall sources are claiming the Tory Party’s political position will ‘look a lot better by the end of the week’.
Mr Hunt received the latest forecasts from the Office For Budget Responsibility on Friday, which showed his fiscal headroom to be between £25 billion and £30 billion – enough for an eye-catching income tax drop or a relaxation of frozen tax thresholds.
As revealed by The Mail on Sunday last weekend, speculation had grown about a ‘rabbit’ being pulled out after a senior Government source told the MoS that the Autumn Statement will be ‘more of a Budget’ and bigger than expected.
Government whips have scheduled three days of debate and votes on the Autumn Statement, which suggests that it has more fiscal measures ‘akin to a mini-Budget’.
Speaking to The Mail on Sunday in an exclusive interview today, former Home Secretary Suella Braverman said: ‘We are the party of low tax – we need to demonstrate that. We need to move urgently to demonstrate to the British people that we’re on their side.’
On Wednesday Mr Hunt is expected to announce £20 million to speed up the development of new dementia treatments. In his economic assessment he will also trumpet the Tories’ success in lowering inflation from double digits last year by keeping the lid on Government spending and resisting inflation-busting pay deals in the public sector.
Call for carbon levy to slash fuel duty
The Chancellor has been urged to use the proceeds of a proposed ‘polluter tariff’ on imports to cut fuel duty – a move that could give a much-needed boost to struggling households, writes Anna Mikhailova.
Jeremy Hunt is understood to be keen on the levy on goods from countries with big carbon footprints, such as China and India.
And cross-party MPs have been lobbying him to pledge to use the money this would raise to fund a fuel duty tax cut in this week’s Autumn Statement.
Fuel duty on both petrol and diesel has been frozen at 57.95p per litre since March 2011 and was temporarily cut by an extra 5p per litre in 2022. That cut is due to expire in March.
Howard Cox, founder of the FairFuelUK campaign, urged the Chancellor to go further and cut even more off the cost of driving.
Mr Cox, who supports using a carbon levy to fund this cut, added: ‘Lower fuel duty will reduce inflation, create more jobs and give people more disposable income.’