21 November 2023 , 11:39
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A top Tory has let slip that Jeremy Hunt will announce personal tax cuts in the Autumn Statement tomorrow.
Laura Trott, who is the Chancellor's deputy, said the tax and spending plans would include measures that help individuals. It is thought the Government may announce a cut in either income tax or national insurance.
Asked whether the Autumn Statement would go beyond business tax cuts, the Chief Secretary to the Treasury told the BBC: "The economy is in a very different place to where we were a year ago and we can now focus on going for growth, pushing up the growth rate of the economy and cutting taxes for individuals."
Ms Trott, 38, was promoted to her post as the second in command at the Treasury in last week's reshuffle. She was first elected as an MP in 2019.
Tory MPs are clamouring for tax cuts in a desperate bid to turn around the party's dire poll ratings. A cut to income tax or national insurance would help get money into the pockets of working people. In a speech on Monday, Rishi Sunak declared: "I want to cut taxes, I believe in cutting taxes."
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The Conservatives vowed at the last election that they would not raise income tax, national insurance or VAT but as Chancellor Mr Sunak last year increased national insurance as he took the country to its highest tax burden in 70 years.
Alternative options include reducing the headline rate of income tax. During his unsuccessful Tory leadership bid last summer when he lost to Liz Truss, Mr Sunak promised to cut income tax by one penny in the pound - from 20p to 19p by 2024 - and a further 3p off by 2029. He's gone quiet on that idea after Ms Truss triggered an economic meltdown by promising unfunded tax cuts in her mini-Budget.
Mr Hunt could instead opt to increase tax thresholds - the amount you can earn before being pushed into a higher tax bracket. The basic personal allowance currently is £12,570, meaning you can earn this much without having to pay any income tax. Earnings above this amount are subject to the basic rate of 20% and above £50,270 you pay the 40% higher rate. The Government has said these thresholds will be remain frozen until April 2028, meaning millions of people will end up in a higher tax bracket.