Households struggling with the cost-of-living crisis could see further tax cuts depending on who becomes the next UK Prime Minister
Depending on which Tory leader finishes in 10th place, households could see either more tax cuts or increased financial aid from the government as the country heads into a winter when energy bills could soar to over £4,000.
Current Prime Minister Boris Johnson (with his former Chancellor Mr Sunak) has already provided emergency aid e.g. B. a £650 living expenses payment for eligible households, a £400 rebate on energy bills for all taxpayers and a £150 council tax rebate.
What happens next ultimately depends on who members of the Tory party elect as the new prime minister, so Mazic News took a look at what the two hopefuls for the role had to say about what they would do to end the crisis so far reduce the cost of living.
The former Chancellor has claimed he will increase the cost of living by “a few hundred pounds” if he becomes the next Prime Minister.
In a statement, Mr Sunak said: “This winter is going to be extremely tough for families across the country and I have no doubt that more support is needed.
“Bills are rising faster than expected and the next government must act.”
The Richmond MP said he will act once there is more clarity on how much bills will rise.
He also criticized Ms Truss’ tax proposals, claiming they “won’t help” people on low incomes or pensioners, whom he said would be the people who would need the most support.
Experts at Cornwall Insight predicted energy bills could soar to an alarming £3,582 a year from October and £4,266 a year from January, with charities warning vulnerable households will resort to “desperate methods” to save money.
Mr Sunak has also said he will go beyond the support of up to £1,200 he announced as Chancellor.
“I will look into doing more, especially for families such as retirees.”
His plans came as a surprise to some, as the former chancellor positioned himself as one of the most fiscally conservative candidates in the early stages of the leadership contest.
He condemned the foreign secretary’s promises of unfunded tax cuts as “consoling fairy tales” and previously told voters he would keep the national insurance hike if he became prime minister.
This prompted critics to accuse him of “tax overturning”, with Economy Minister Kwasi Kwarteng, a senior ally of Ms Truss, suggesting the pledge came only in response to his rival’s vows to cut taxes.
Ms Truss, on the other hand, has declined to promise new living expenses payments and has said she will not give “handouts” to families.
Instead, it will focus on cutting taxes.
The Foreign Secretary told the Financial Times: “Of course I will look at what else can be done.
“But I would go about things conservatively by lowering the tax burden and not handing out handouts.”
She has come under fire from some for those comments, prompting former Tory leadership hope Penny Mordaunt to defend Ms Truss – arguing her comments had been misinterpreted.
But Mark Harper, former Chief Whip, wrote on Twitter: “Stop blaming journalists (again) – reporting what you actually say will not be ‘misconstrued’.
“Something like this happened under the current [Prime Minister] and enormously damaged faith in all of us.
“So what does ‘no charity’ mean then?”
Ms Truss’ current plans include cutting Social Security by £59 a year for minimum wage workers.
She has also announced plans to reduce environmental taxes on energy bills.
But she, too, may be making an about-face in her cost-of-living plans, as key ally James Cleverly revealed: “For the people who don’t benefit directly from tax cuts, she’s looking for targeted help.”
She also told the Evening Standard: “I can assure you I will do everything I can to help households across the UK. I understand how difficult the circumstances are.”
Pundits have raised concerns that tax cuts could increase inflation, which is currently at a 40-year high of 9.4%.