Chancellor launches policies including an energy windfall tax – here are the main points, with political analysis
Rishi Sunak says the government will set out help those for whom the “struggle is too hard and the risks are too great” amid the cost of living crisis. “This government will not sit idly by,” he adds.
The chancellor announces a “temporary targeted profits levy” to tax extraordinary profits of energy companies, while still incentivising investment.
The levy will raise about £5bn of revenue, helping to fund the government’s energy support package.
Sunak says “we should not be ideological about this – we should be pragmatic,” arguing that the government can tax these profits fairly and in a way which does not discourage investment.
The levy will be phased out when current high prices fall, with a “sunset clause” written in to the legislation.
Sunak says the government will target financial support to the poorest households.
The government will send directly to about 8m households a one-off “cost of living payment” of £650, direct to people’s bank accounts.
The support is worth more than £5bn “to give people certainty that we will stand by them at this challenging time”.
The payment will go to households in receipt of welfare benefits.
The chancellor says this system is more effective than uprating the value of benefits.
The chancellor says 8m pensioner households will receive a “pensioner cost of living payment” of £300.
He says 6 million non-means-tested disability benefit recipients will receive a £150 payment.
The chancellor says it is the right thing to do to support all families with the cost of living crisis, as well as those at most need.
Sunak says the repayment of the £200 repayable loan, due in October, will be turned into a grant. The payment will be doubled to £400 for everyone.
The funding is worth £6bn, he says, adding: “We are on the side of hard-working families.”
The chancellor says the total cost of living support is worth £15bn to help families with rising costs, while supporting the most vulnerable in society.
This is on top of £22bn announced in the spring.
Across all the support, almost all of the 8m most vulnerable households will in total receive at least £1,200 in support.
Sunak concludes by saying, for the poorest in society, “they will feel some of the burden eased, some of the pressures lifted. They will know this government is standing by them.”
