THE BATTLE to become Prime Minister began in earnest this weekend with a row over whether Britain should cut taxes.
There are now nine declared candidates to become Boris Johnson’s successors – with a tenth, foreign secretary Liz Truss, expected to join them later today or tomorrow.
Yesterday saw a host of pledges to cut taxes from the various Conservative candidates, seemingly in rebuke to former Chancellor and the favourite in the race Rishi Sunak’s position that the UK needs to see healthier public finances before bringing down a seventy-year-high tax burden.
Amongst the more eye-catching promises was Sajid Javid’s pledge to scrap the hike in national insurance brought in earlier this year to fund parts of the NHS – brought in whilst Javid himself was health secretary.
“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,”
Both he and fellow candidate Jeremy Hunt – the former health and foreign secretary – also promised to cut corporation tax to 15 per cent, down from a rate of 25 per cent as of April next year.
The claims are an attempt to put clear blue water between themselves and Sunak, who in his campaign launch warned against “comforting fairytales” and has said tax cuts will need to wait until the nation’s pocketbook is in healthier shape after the pandemic.
Sources in Javid’s camp pointed to former chancellor George Osborne’s decision to cut the top rate of income tax from 50p to 45p, which in fact boosted the Treasury’s overall take, as evidence that tax cuts can help the public finances as well as stimuate growth.
Liz Truss is expected to mirror Javid’s call to reverse the national insurance hike when she enters the race this week, whilst another contender for the top job – Nadhim Zahawi – endorsed a ‘charter for tax cuts’ over the weekend.
Already in the contest are Penny Mordaunt – who has seen the second-most endorsements by fellow Tory MPs so far – transport secretary Grant Shapps, and Tom Tugendhat, the former soldier and now chair of the foreign affairs select committee, who yesterday promised a “fresh start” for the country and the Conservatives whilst also promising to look at reduced tax rates.
They are joined by up and comer Kemi Badenoch and Brexiteer-favourite Suella Braverman.
Paul Johnson, the director of the Institute for Fiscal Studies, said that due to an aging population Britain would need to “spend much more on (the) NHS, social care and pensions” and that to do so without tax cuts would require “major surgery to parts of the (the) welfare state.”