Sunak tries to close gap on rival in PM race – Times of India


LONDON: Rishi Sunak, trailing behind the race to become Britain’s next prime minister, has vowed to cut the base income tax rate by 20% by 2029 in a possible make-or-break roll of the dice by the former Minister of Finance. Sunak, once seen as the favorite to Boris. to replace Johnson as he helped steer the economy through the ravages of the Covid pandemic, his rival, Foreign Minister Liz struggled trusswhich has promised immediate tax cuts.
Truss seems to have more momentum and has gained the support of several leading lawmakers and ministers. Sunak’s replacement as finance minister, Nadhim Zahawisaid he supported Truss because she offered a “booster” economic approach compared to “doomster” Sunak.
Sunak accuses Truss of peddling unrealistic promises, especially about the economy. Truss says she will immediately cut taxes to alleviate the cost of living crisis by financing it through borrowing. Sunak argues that it is essential to get inflation under control first. But on Monday, he promised a major income tax cut in the coming years, in what critics say was a reversal forced by the pressures of Truss’ campaign.
Sunak said he remained focused on tackling inflation, but once that was achieved, he would go ahead with an already announced plan to take 1 pence off income taxes by 2024, then take another 3 pence against it. end of the next parliament, probably around 2029. The two pledges would bring income tax from 20p to 16p. Sunak said the plan would represent the biggest income tax cut since Margaret Thatcher’s time. “It’s a radical vision, but it’s also a realistic one,” he said in a statement late on Sunday. Sunak told BBC Radio on Monday that he would fund the tax cut by growing the economy and being disciplined with government spending.
The announcement comes at a crucial time in the race to succeed Johnson. On Monday, the 175,000 conservative grassroots members received their ballots to choose Sunak or Truss as the party’s next leader and prime minister. They are both eager to get support from the winner to be announced on September 5.
With inflation rising to 9.4% in 40 years and growth stalling, the economy dominated the early stages of the contest, with Sunak arguing that Truss’ plan to reverse a rise in Social Security contributions and a planned canceling the corporate tax hike would further fuel inflation. “I don’t think it would be wise to over-borrow at a time when inflation and interest rates are already rising,” Sunak said. Sunak said every penny cut in the income tax rate would cost about £6 billion ($7.3 billion) a year, a figure he said still exceeds Britain’s debt-to-GDP ratio. would continue to decline if the economy grows in line with official forecasts. Truss has argued that tax cuts are now needed to boost the economy.
Sunak also defended his decision to leave the Johnson administration. Johnson’s allies accuse Sunak of treason after he resigned as head of the UK’s treasury last month as the government struggled amid ethics scandals, with a letter of resignation saying “we can’t go on like this”. More than 50 ministers resigned, leaving Johnson with no choice but to resign. Polls from Tory members put Truss ahead of Sunak in race to succeed Johnson as party leader. Sunak said his critics “looked at the last few months of the government through rose-colored glasses”.
He said that “the government was on the wrong side of a very serious ethical issue”. Johnson led the Conservatives to an overwhelming parliamentary majority in 2019, but he has since been plagued by scandal and has been fined by the police for parties violating the Covid lockdown rules. He finally retired on July 7.

Source link


Please enter your comment!
Please enter your name here