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Rishi Sunak Accused Of “Cynically” Saving Tax Cuts For An Election Instead Of Curbing Cost Of Living Crisis Now

Rishi Sunak Accused Of “Cynically” Saving Tax Cuts For An Election Instead Of Curbing Cost Of Living Crisis Now

Rishi Sunak has refused to scrap next month's National Insurance rise despite the cost of living crisis (Alamy)

3 min read

Labour has accused Rishi Sunak of “cynicism” over his apparent resistance to cutting taxes in next week’s spring statement to ease the cost of living crisis, instead saving the move until an election is nearer.

Shadow Chief Secretary to the Treasury Pat McFadden believes the Chancellor is operating not in the best interests of the public, but in order to “chime with a Tory election grid”.

Speaking to The Rundown podcast from PoliticsHome, he said Sunak believes he is a “Thatcherite tax-cutting Chancellor, but in his deeds is closer to Ted Heath”.

McFadden said the inflationary pressures and rising fuel prices are being experienced by lots of countries, especially given the impact the Russian invasion of Ukraine is having on global markets.

But he argued that UK consumers are going to feel it much worse as the government is determined to go ahead with a National Insurance increase next week, while also freezing income tax brackets.

“What we'd like to see is the government decide not to go ahead with the personal tax increase and the NICs increase next week,” he said.

“But also to beef up the package of help for people with energy bills, which didn't look very good when it was announced about a month ago, and it's been rendered completely obsolete by the impact of Russia's invasion of Ukraine.”

Sunak was criticised for announcing a £200 loan for people to help with their energy bills, despite the price cap increasing for a typical household by £693 a year in April. 

McFadden said Labour wants the government to use the increase in VAT receipts due to higher inflation to help people with their bills, as well a one-off windfall levy on the oil and gas companies “who are enjoying stratospheric profits through these global price rises”.

He criticised the Chancellor for not so far indicating he is open to cutting taxes when he comes to the Commons to deliver the Spring Statement on Wednesday, believing Sunak will instead hold them back for the Budget this autumn.

“The Treasury is telling anyone who will listen that they are bringing these tax increases in now, because they want to cut taxes before the election,” he said.

“That looks pretty cynical, it looks as though this is not being done in the best interests of the fiscal position or of the public services, but it's been done to chime with a Tory election grid.”

McFadden also pointed to new analysis by the Institute for Fiscal Studies which showed Sunak had increased taxes by 2% of GDP in just two years, something the previous Labour government only did in 10 years in office.

“I don't know who the Chancellor is convincing with these constant hymns of praise to Thatcherism,” the Labour frontbencher said.

“The truth is maybe in his mind he is this Thatcherite tax-cutting Chancellor, but in his deeds is closer to Ted Heath, and that's what we're seeing.

"We're seeing a combination of tax raises and inflation growing reminiscent of some decades ago, and there's a phrase in the Bible something like 'by the deeds, you shall know them'.

“And that's what I think people have got to look at, and through the actions of the Chancellor I believe he has forfeited the right for the Conservative Party to be considered as a tax-cutting party.”

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