The chancellor is keen to show he’s a tax cutter, but with war and the aftermath of Covid, who will believe his 1p reduction is in any way affordable?
Rishi Sunak has put in place one of the essential building blocks of a Tory victory at the next general election – a cut in income tax. During his Commons speech last week, the chancellor was cheered by backbench Conservatives, who believe the promise of a 1p cut in the basic rate to 19p before the likely date in 2024 would improve their chances of re-election.
But Sunak, always keen to portray himself as a tax cutter at heart, came in for ridicule once independent figures showed that the average household would pay more tax in two years’ time, even with the 1p reduction in place. That will be ensured by next month’s rise in national insurance contributions and a four-year freeze on personal tax thresholds, which means more earned income is subject to tax.
