Chancellor Jeremy Hunt has emphasized the importance of tax cuts for businesses in order to stimulate economic growth. In an interview with HOAR, Hunt stated that if there is room for maneuver, he will prioritize tax cuts for businesses. He believes that by improving the long-term capacity of the British economy to generate wealth, the necessary funds can be generated to support the National Health Service (NHS).
Boosting the economy through tax cuts
Hunt expressed his belief that tax cuts for businesses should always be a priority, as they contribute to the overall improvement of the British economy. He stated, "Because in the end what we need to do is to improve the long-term capacity of the British economy to generate the wealth we need to pay for the NHS. So that will always be the priority."
Potential room for tax cuts
Hunt will be reviewing the final forecast from the financial watchdog, with hopes that there could be up to £20 billion available to support tax cuts. This could provide the necessary room for maneuver to implement the desired tax cuts.
Government's response to recent challenges
The upcoming Autumn Statement is seen as an opportunity for the government to regain control following the Supreme Court ruling against the Rwanda deportation plan. Additionally, Downing Street has been encouraged by the positive news on inflation, which has reached 4.6%, meeting the Prime Minister's target to halve the rate by the end of the year.
Responsible fiscal measures
The Chancellor emphasized the government's commitment to responsible fiscal measures and avoiding the risk of uncontrollable inflation. Hunt stated, "We do want to bring taxes down. There are no shortcuts to doing that. The one thing we won’t do is to bring taxes down in a way that fuels inflation. Because having just halved inflation, we don’t want to do anything irresponsible that will take us in the other direction."
Possible measures in the upcoming mini-Budget
The mini-Budget scheduled for next Wednesday could include the extension of "full expensing," which allows firms to write-off investments, such as IT equipment, against tax. There is pressure from both Tory MPs and Labour MPs to make this move permanent. Furthermore, there is speculation about possible cuts to inheritance tax, although final decisions will be made over the weekend. The hospitality industry may also benefit from an extension of business rates to support its future and the High Street.
Prime Minister's viewpoint
When asked about cutting taxes, Prime Minister Rishi Sunak emphasized the importance of halving inflation and its positive impact on the economy. He stated, "Now of course I know people are still suffering, they have been, so there’s work to do, but that’s an important milestone because inflation is like a tax: it makes everyone feel poorer."
