Rishi Sunak vows Government will ‘do more when it can’ to cut taxes

Rishi Sunak has suggested there will be more tax cuts next year following those announced in the Autumn Statement.

The raft of cuts announced by Chancellor Jeremy Hunt this week included a 2% cut in national insurance, and the extension of a policy which lets businesses write off costs of capital investments against tax bills.

Mr Sunak said the cuts were the “start of a journey,” adding: “We will do more when we can, because I want to cut taxes, reward hard work, grow the economy and do so in a way that is responsible.

“I always said I wanted to cut people’s taxes, but first we had to get inflation under control and stabilise the economy.

“We have now done that and it didn’t happen by accident. The Chancellor and I took a set of decisions that weren’t easy, that we got a lot of flak for, that the Labour party opposed, in order to halve inflation and defy the sceptics.

“Everyone said we were going to have a recession this year in the UK – we have actually grown the economy. Because of that our economic policy can shift gears.”

Mr Hunt’s statement was welcomed by businesses, but economists have warned that his fiscal plans will result in painful and “implausible” savings for already-squeezed departments and public services beyond the next general election.

Despite the earnings bonus, millions of workers will face a squeeze on their finances with the tax burden still set to reach a record high.

It is feared, the continuing freeze in personal tax thresholds will wipe out the benefit of the national insurance reductions for many workers, as higher earnings see millions pulled into paying more to the Exchequer through “fiscal drag”.

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The Government has insisted that boosted productivity in the civil service can help deliver savings, but some commentators have warned that if implemented the Chancellor’s plan could usher back in an era of austerity.

Adressing the claims, Mr Sunak said: “People don’t want the Government to be spending ever more money. What they want are reformed public services that deliver for them, and high productivity.

“That’s what you get in the private sector, and we need to see that in the public sector. We are at a point now where our priority going forward is to cut people’s taxes.

“Public spending is already at record highs in this country, the Government is already spending an enormous amount of money.”

He said that the priority had to be “driving up public-sector productivity”.

Additonal reporting by Press Association.