Boris Johnson tax cut plans: PM hints at future tax cuts but how will it impact YOU?

Boris Johnson: UK 'setting example' for green agenda

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Tax rises are expected in a bid to recover costs spent throughout the pandemic. Polls by Kekst CNC shows 90 percent of people expect to feel strapped by higher costs of living in the next three years. A massive 88 percent expect Boris Johnson to raise National Insurance taxes – but if the Government cuts taxes in the wake of these hikes what would it mean for Britons?

The UK leader hinted at future tax cuts for UK businesses this week.

Mr Johnson alluded to these taxation changes as the Chancellor of the Exchequer Rishi Sunak prepared to make historic rises in the coming years.

Speaking to Bloomberg, Mr Johnson said: “You can take it that Rishi Sunak, as indeed am I, is a staunch, low-tax Conservative, and he believes in an enterprise economy.”

The PM said he and Mr Sunak are “low-tax Conservatives”.

The Conservative Government is prepared to raise the tax burden as a portion of national income to 35 percent.

The Institute for Fiscal Studies (IFS) claims this will be the highest sustained level of taxation since 1955.

The think tank claimed these historically large tax increases were “smuggled in” under the cover of the Covid pandemic.

The £42bn a year tax increases announced by the chancellor this year in corporation tax, income tax and national insurance would merely shore up the public finances and fund health and social care spending that would have been needed anyway, the report said.

Paul Johnson, director of the IFS, said: “The tax rises have been smuggled in under the cover of the pandemic,” adding that they were “needed to fund social care and the NHS and had literally nothing to do with the pandemic”.

Chancellor Rishi Sunak is said to be considering a five percent cut to the VAT on household energy bills.

Several Tory MPs have demanded Mr Sunak reduce the VAT rate in his October 27 budget to show the Government is responding to a looming cot of living crisis.

However, Mr Sunak is resistant to pressure to spend the Budget in this manner due to the wariness of what reducing the VAT rate would cost the Government £1.5bn annually.

One Treasury official told the FT: “It would tick two boxes — it reminds people of the benefits of Brexit and shows you’re listening to people.”

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Tax cuts must however wait until the economy is sustainable, Mr Sunak said earlier this month.

Speaking at the Conservative Party conference in Manchester, the Chancellor stressed the importance of getting the economy on an even keel after the £400bn costs of the Covid pandemic must take priority over lowering taxes.

Mr Sunak said: “Our recovery comes with a cost. Our national debt is almost 100 per cent of GDP.

“So we need to fix our public finances. Because strong public finances don’t happen by accident.

“They are a deliberate choice. They are a legacy for future generations and a safeguard against future threats.”

The Chancellor admitted these measures would be unpopular and to some degree “un-Conservative”.

But he added: “I’ll tell you what is un-Conservative: Unfunded pledges, reckless borrowing and soaring debt.

“Anyone who tells you that you can borrow more today, and tomorrow will simply sort itself out just doesn’t care about the future.

“Yes, I want tax cuts. But in order to do that, our public finances must be put back on a sustainable footing.”

Mr Johnson discussed tax cuts at the Tory Party conference as well.

He said: “I can tell you that you have no fiercer and more zealous opponent of unnecessary tax rises than me.

“But we’ve had to deal with a pandemic on a scale which this country has not seen before in our lifetimes and long before.”

At the beginning of the month, a Treasury source said: “I don’t think Rishi or the Prime Minister at this point are thinking about tax cuts.”

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