Three chancellors go to war over putting money back in Brits’ pockets in bid to be next Prime Minister
THREE chancellors — two former and the one currently in office — went to war last night over putting money back in people’s pockets.
Sajid Javid — Boris Johnson’s first chancellor — vowed to unleash a monster £40billion of tax cuts.
Current Treasury chief Nadhim Zahawi claimed he would dole out £32billion in tax cuts — which he said would leave hardworking Brits at least £900 a year better off.
But Rishi Sunak, Mr Javid’s replacement in the No 11 hotseat, will today tell them both to stop “lying to voters”.
In a blistering attack, he will say: “We need a return to traditional Conservative economic values — and that means honesty and responsibility, not fairytales.”
Unveiling his three-point economic plan, he will vow to cut taxes, but only when inflation comes down and the economy is growing.
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He will say: “My message to the party and the country is simple — I have a plan to steer our country through these headwinds. Once we have gripped inflation, I will get the tax burden down. It is a question of ‘when’, not ‘if’.”
And he will hit back at Tories branding him a “socialist chancellor” for whacking taxes up to their highest rate since the 1940s.
He will insist he is a man who can make tough decisions.
Mr Sunak will say: “I had to make some of the most difficult choices in my life when I was chancellor — in particular how to deal with our debt and borrowing after Covid.
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“I have never hidden from those, and I certainly won’t pretend now the choices I made, and the things I voted for, were somehow not necessary.
“Whilst this may be politically inconvenient, it is the truth.”
At a sweltering leadership meeting at the famous Cinnamon Club curry house in Westminster, Mr Javid continuously mopped his brow as he promised a tax-cutting splurge.
In launching his bid for the top job, he vowed to cut fuel duty by 10p, scrap the new National Insurance levy, cut 1p off income tax next year and spike the planned hike in corporation tax.
He thundered: “We need tax cuts to kickstart growth.”
Denying it would blast a giant black hole in the public finances, Mr Javid insisted it would turbocharge the economy — helping raise more tax in the long-run.
Meanwhile, Mr Zahawi said he will cut taxes every year if he gets the keys to No 10.
He will cut income tax by 1p next year and by another 1p the following year — handing Britons £900 in tax back.
He also told The Sun he would extend the £150 council tax rebate to bands E and F.
Mr Zahawi said: “Finally, after too many years of tax and spending skyrocketing, the political landscape is once again coming back to the sensible policies championed by Margaret Thatcher.
‘CUT TAX’
“So let me be clear. Tax as a percentage of GDP will fall year on year if I become Prime Minister. That is a promise.
“As Prime Minister, I will cut the base rate of income tax to 19p in 2023 and 18p in 2024. That will give households back £900 a year on average.
“Families cannot save what has been taken from them.”
It came as fellow PM hopeful Liz Truss warned the Tory Right they would hand the keys of No 10 to Mr Sunak unless they united behind her.
The Foreign Secretary feared the Thatcherite vote would be splintered between Suella Braverman and rumoured campaigns by Priti Patel and Jacob Rees-Mogg — although Mr Rees-Mogg confirmed last night he would not be standing.
In a rare change in fortunes, Labour accused the Tories of promising cash like there is a magic money tree.
They said that when it was all added up, the contenders had made £330billion in spending and tax cutting pledges.
It came as ultra-low-tax Brexit guru Lord Frost warned he would never endorse Mr Sunak to be the next PM unless he vowed an “immediate change of direction”.
Meanwhile, Bank of England governor Andrew Bailey said tax policy should only be made at Budgets.
He told the Treasury Committee yesterday: “I don’t like offering views on the constitution, but I don’t think things that should be done in Budgets can ultimately be done outside Budgets.”
Mr Bailey admitted the Bank is monitoring the use of Buy Now, Pay Later credit with food shopping.
He said: “It’s something we are watching and keeping a close eye on.”
He added he expected inflation, which hit a record 9.1 per cent high in May, to fall back to two per cent within two years.
Big guns in tough quiz on finances
MULTI-millionaire Tory leadership hopefuls were yesterday dogged by questions on their money.
Chancellor Nadhim Zahawi struggled when quizzed on TV about how rich he is.
Former Health Secretary Sajid Javid refused to say if he had stashed cash in a tax-haven.
He said his tax papers were all “correct, proper, within all the rules” despite registering as a “non-dom” while he was a jet-setting financier.
Non-doms do not pay UK tax on money they earn overseas — even if they live here full-time.
Mr Zahawi, who is reportedly being probed by HMRC, called the allegations smears.
In a flustered Sky appearance he said: “I don’t think it’s right to go into numbers because I’ll probably get it wrong.
“These things move around.”