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Taxes will go down again in the Spring Budget, Jeremy Hunt has promised as Conservative MPs called for more action to reduce the burden on the public after the Autumn Statement.
The Chancellor reduced national insurance for most workers and introduced tax breaks for business – but the overall tax take is still heading for a record high despite the cuts announced on Wednesday.
Mr Hunt is understood to be already thinking about possible tax cuts which he could announce in March at the final Budget before the next general election. He told Times Radio: “I hope we are able to reduce the tax burden still further in the future.”
And talking to LBC, he defended the decision to cut personal taxes in stages, beginning with a 2p reduction in the rate of employees’ national insurance contributions. The Chancellor said: “It’s a step towards bringing down taxes on families who’ve seen their taxes go up, because I think we took the right decision to pay down the Covid debt… We want to take people out of tax. We want to reduce taxes. We will get there in a responsible way.”
Dame Priti Patel, the former home secretary, welcomed the cuts but called for more action to reduce taxes, including by raising the thresholds at which people start paying the basic and higher rates of income tax.
She told GB News: “I’m a great believer in unfreezing those tax thresholds. There are many people on low incomes who get caught in that tax threshold that has been frozen – the personal tax allowance.
“And also the higher rate, so for example, many of our public sector workers; our police officers, nurses and teachers, they now get caught in that fiscal drag which basically means more of their income gets hoovered up by the Exchequer.”
Tory veteran Sir Robert Syms told the House of Commons: “It is going to be an interesting year… At the end of the day I suspect in October, November of next year, it will be whether or not the Government continues to make progress as it is making progress and whether people accept that.”
The Institute for Fiscal Studies warned that if economic conditions get worse before the Budget, the Chancellor may end up having to reverse his tax cuts or reduce public spending further. Its deputy director, Carl Emmerson, said: “Policy decisions seem to be ridiculously fine-tuned in response to changes in uncertain and volatile forecasts.”
And Thomas Pope, of the Institute for Government, added: “That is a surefire way to end up with debt rising over time if you spend your good news and swallow your bad news.”