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Sunday, May 29, 2022

Sunak hints at fuel tax cuts in cost of living crisis, but admits ‘won’t be easy’

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Rishi Sunak has hinted that he may cut fuel tax in Wednesday’s mini-budget, saying he doesn’t think prices at petrol stations should be “prohibitively expensive”.

Shadow Chancellor Rachel Reeves said Labor would not oppose the move, which has been demanded by a group of 50 Conservative MPs to ease the cost of living crisis affecting millions of families.

But Ms Reeves said even a 5 pence a liter tax cut would not “be up to the challenge”, saving motorists just £2 each time they fill up their cars at a time when household energy bills to increase £700 Called for a windfall tax on North Sea oil and gas giants to support low-income families, as well as scrapping VAT on household fuel bills and reversing the £1.25 increase Sunak percentage points in National Insurance Contributions (NICs).

Meanwhile, money-saving expert Martin Lewis warned of “panic” as up to 10 million people are forced into energy poverty, saying political action by the chancellor was needed to save the families faced with the choice between “starving or freezing”.

Days before his pivotal spring statement, Mr. Sunak hinted that he is ready to help families with skyrocketing bills, but admitted: “I can’t solve every problem.”

The chancellor urged voters not to be “scared” by the looming cost-of-living crisis, promising: “Where we can make a difference, of course we will.”

But he appeared to acknowledge that any package he hands out won’t be enough to cushion the blow of historic increases in the cost of gasoline, heat and other essentials, telling voters: “It’s not going to be easy.”

Sunak said it was clear that the UK’s sanctions on Russia in response to Vladimir Putin’s invasion of Ukraine were “not gratuitous for us here at home” after wholesale oil and gas prices soared. rise.

“I want to be honest with people that it’s not going to be easy,” Sunak told BBC1. Sunday morning.

“I wish the government could absolutely solve all the problems, that it could completely protect people against all the challenges that are coming.

“I can’t do that, but what I would say is that I will support them in the same way that I have in the last few years. Where we can make a difference, of course we will.”

Mrs Reeves told Sky News ‘ Sophie Ridge on Sunday:: “Wednesday is a historic moment for the chancellor, to show if he really understands the challenges that people are facing right now.”

He cited parents who told him they skip meals to make sure their children eat and retirees who turn off the heat in cold weather to keep bills low.

“For those people and millions of people across the country, we need more than warm words from the chancellor,” said Ms. Reeves. “We need the chancellor to do the things that will relieve that pressure on the cost of living.”

In a series of interviews ahead of his spring statement, Sunak declined to reveal details of the package he plans to reveal.

Once again, he opposed removing or delaying the increase in NICs for employees and employers, which will take effect in April.

And he poured cold water on Foreign Secretary Liz Truss’s request to increase defense spending from 2 percent of GDP to closer to 5 percent of Cold War-era levels, saying the military he had already received generous raises in recent spending deals.

But he left the door open for an increase in Social Security thresholds to get the poorest out of the tax.

Defending his position as the chancellor who has raised taxes by the largest amount for at least 70 years, he said that none of his immediate predecessors had had to deal with a war on the European continent, a pandemic and the worst recession in centuries.

“We have had to make some difficult decisions to restore public finances,” the chancellor said. “Would I have preferred not to have had to do that? I would have done.

“But I do think they are the right and responsible decisions for the long-term economic security of this country and we have done it fairly.

“Going forward, my priority is to cut taxes and put money back in people’s pockets. You saw it in the fall budget. I was very clear about it. And the direction of travel on the rest of the parliament is that.”

Ms Reeves said government waste and inefficiency had left a “black hole” in state finances, pointing to the purchase of personal protective equipment (PPE) during the pandemic, some £8.7bn of which had to be canceled as unusable.

“One can’t help but wonder if this tax increase is to pay for a black hole due to waste and mismanagement by this government,” said Ms Reeves.

Lewis said it was “untenable” to expect ordinary people to ride out the next wave of price increases by cutting back on candy or tightening their belts.

“As the money-saving expert that has been known for this, I have virtually no tools to help people right now,” he said. Sunday morning.

“It’s not something money management can fix. It is not something for those with the lowest incomes to tell you that (tightening) your belt will work. We need political intervention.”

He asked, “Do we want to be a country, and I say this without hyperbole, where we’re going to have the lowest income earners in this country genuinely choosing between starving or freezing?”

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