Rishi Sunak grilled on income tax offer by Andrew Marr
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The former Chancellor faces a showdown with Foreign Secretary Liz Truss in the final of the Conservative leadership race with the pair trading blows over their tax and spend policies. LBC’s Andrew Marr had Rishi Sunak on as a guest for his Thursday afternoon show and quizzed the Tory leadership contender on how his tax promises have gone down with rank and file party members.
Marr asked the Conservative contender: “Let me ask you a little bit about tax if I may.
“Because you have offered a penny off income tax in two years’ time and a lot of party members sitting around tonight wondering who to vote for will be thinking is that it!?”
Mr Sunak replied: “On tax, I set out a roadmap for how to do this a few months ago, so just this month we have already delivered a tax cut and that we raise the amount of money that people could earn without paying a penny of income tax or national insurance.
“I did that, it is making a difference in peoples’ paychecks this month”
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“It is worth about £330 pounds a year.
“It is actually more generous than an income tax cut and that is happening this month.
“And yes we will deliver another income tax cut in this parliament and that is already in the plans and has been paid for and is consistent with us making sure we get a grip on inflation, and not making the problem worse.
“Because I want to put more money in people’s pockets, of course, I do.”
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It comes as Liz Truss has defended her tax cut plans costing at least £30 billion a year as “affordable” as the economic policies of the Tory candidates for prime minister came under scrutiny.
Mr Sunak was understood to not be envisaging cutting personal taxes until at least autumn next year to avoid fuelling inflation.
But Ms Truss, the Foreign Secretary, promised an emergency budget to reverse the national insurance hike immediately under her proposals to drive growth.
The financial plans of the final candidates for prime minister were growing ever more divided as they battled for the votes of the Tory membership required to win the race for No 10.
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Robert Joyce, the deputy director of the Institute for Fiscal Studies (IFS) think tank, put Ms Truss’s tax cuts at “more than £30 billion per year – and possibly considerably more”.
The plans “mean higher borrowing or less public spending, or some combination”, he said, though their impact remains unclear because Ms Truss’s plans are “yet to be fleshed out”.
“Without spending reductions, the tax promises would likely lead to the current fiscal rules being broken, and Ms Truss has hinted that the fiscal rules may change,” Mr Joyce added.
But Ms Truss defended her plans to scrap the scheduled corporation tax rise and suspend green levies on energy bills as “not a gamble”.
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