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Tuesday, June 25, 2024

Rishi Sunak unveils £17BN of tax cuts in make-or-break Tory manifesto: PM vows to scrap NI for self-employed, knock another 2p off main rate, and slash Stamp Duty – as he warns Labour would ditch Rwanda flights and be Net Zero ‘zealots’


Rishi Sunak rolled the dice with £17billion of ‘Thatcherite’ tax cuts today as he unveiled the Tory manifesto.

Watched by wife Akshata, the PM tried to get his election hopes back on track with a bold package to ease the sky-high burden on Brits.

Speaking at the Silverstone race circuit after a torrid campaign blighted by his D-Day bungle, Mr Sunak joked it was the perfect place to demonstrate that the economy had ‘turned a corner’.

Mr Sunak insisted he is not ‘blind to the fact that people are frustrated with our party and frustrated with me’, acknowledging that ‘we have not got everything right’. 

But he said the 76-page manifesto laid out a ‘moral mission’ to put money back in people’s pockets – pleading with voters not to give Keir Starmer a ‘blank cheque’. 

In a stark warning, Mr Sunak insisted that if Sir Keir wins he will bring the voting age down to 16 to ensure he is ‘in power for a very long time’. 

Key points from Rishi Sunak’s Tory manifesto speech 

Mr Sunak insisted he is not ‘blind to the fact that people are frustrated with our party and frustrated with me’, acknowledging that ‘we have not got everything right’. 

The premier painted himself as the heir to Thatcher, saying he stood for ‘sound money’ and a ‘moral’ mission to bring down tax. 

He warned that if Keir Starmer wins he will bring the voting age down to 16 to ensure he is ‘in power for a very long time’.

PM committed the Tories to ‘halving’ net long-term immigration and then reducing numbers ‘every single year’.

He said Labour would cancel Rwanda flights, while he would ensure they take off next month.  

In another swipe Mr Sunak cautioned that Sir Keir would be a ‘zealot’ about Net Zero targets. 

Labour would also cancel Rwanda flights, while he has committed the Tories to ‘halving’ net long-term immigration and then reducing numbers ‘every single year’. In another swipe Mr Sunak cautioned that Sir Keir would be a ‘zealot’ about Net Zero targets. 

The blueprint includes a promise of a further 2p cut in National Insurance by 2027, along with a pledge to phase out the ‘double-tax on jobs’ completely when resources allow.

It says that NICs will be abolished altogether for four million self-employed over the next Parliament.  

Mr Sunak is also pledging to axe stamp duty on properties worth up to £425,000 to boost first-time buyers, and revive the Help to Buy scheme, which offered discounted mortgages for those wanting to get on the ladder. 

The Tories said it would mean a total tax reduction of £1,350 for the average worker on £35,000, and have also committed not to increase income tax or VAT rates.

Mr Sunak – who was introduced by Tees Valley mayor Lord Houchen – insisted the policies will be funded with a £12billion crackdown on benefits and reducing the size of the civil service. 

Keir Starmer has already admitted Labour will not match tax cut promises, branding it a ‘Jeremy Corbyn-style manifesto’ full of uncosted promises.

However, there is some Tory disquiet that the package did not go further after speculation about a proposal to abolish inheritance tax. 

The IFS think-tank has also calculated that taxes would remain near a record high even with the measures, as more and more Brits are dragged into frozen tax thresholds.

Meanwhile, questions have been raised about the chances of raising billions of pounds by cutting civil service headcount. Despite a push on the issue, ONS figures showed numbers rising to the highest level in 18 years in March, at 543,000. Numbers are up 22,000 over the past year. 

In other twists and turns today:

  • Nigel Farage has suffered another attack after being pelted with wet concrete in Barnsley; 
  • Labour has come under fire from business after refusing to rule out hikes to capital gains tax;
  • Keir Starmer has unveiled plans to ban under-16s from buying strong energy drinks; 
  • Mr Farage‘s BBC Panorama grilling has been delayed from tonight due to an apparent diary mix-up;
  • There were more signs the cost-of-living squeeze on Brits is easing with figures showing wages rising faster than inflation
Speaking at the Silverstone race circuit after a torrid campaign blighted by his D-Day bungle, Rishi Sunak joked it was the perfect place to demonstrate that the economy had 'turned a corner'

Speaking at the Silverstone race circuit after a torrid campaign blighted by his D-Day bungle, Rishi Sunak joked it was the perfect place to demonstrate that the economy had ‘turned a corner’

Watched by wife Akshata and Cabinet ministers, the PM is trying to get his election hopes back on track with a bold package to ease the sky-high burden on Brits

Watched by wife Akshata and Cabinet ministers, the PM is trying to get his election hopes back on track with a bold package to ease the sky-high burden on Brits

The manifesto document published today does not include a single photograph

The manifesto document published today does not include a single photograph 

Ally Mel Stride and Kemi Badenoch were in the audience for the manifesto launch today

Ally Mel Stride and Kemi Badenoch were in the audience for the manifesto launch today 

The Sunaks were flanked by activists as the party tries to put on a show and win over voters

The Sunaks were flanked by activists as the party tries to put on a show and win over voters

The smiling PM was accompanied by wife Akshata as he turned up at the Silverstone race track to launch his fightback after a turbulent campaign

The smiling PM was accompanied by wife Akshata as he turned up at the Silverstone race track to launch his fightback after a turbulent campaign

In a striking mea culpa, Mr Sunak said: ‘I’m not blind to the fact that people are frustrated with our party and frustrated with me.

‘Things have not always been easy. And we have not got everything right.’

But he insisted ‘we are the only party in this election with the big ideas to make our country a better place to live’.

‘We Conservatives have had to take difficult decisions because of Covid. But we are now cutting taxes for earners, parents and pensioners,’ Mr Sunak said.

‘We are the party of Margaret Thatcher and Nigel Lawson, a party, unlike Labour, that believes in sound money.

‘We believe that it is morally right that those who can work do work, and hard work is rewarded with people being able to keep more of their own money.

Conservative election manifesto, key points: 

TAX

2p cut in National Insurance Contributions (NICs), along with ambition to eventually abolish the ‘second tax on jobs‘. NICs to be abolished for the self-employed.

Triple tax lock ensuring no rise in headline rates of income tax, National Insurance or VAT.

Family Home Tax Guarantee, pledging no increase in stamp duty or capital gains tax on the family home and no new council tax bands or revaluations.

Threshold for first-time buyers paying stamp duty raised to £425,000.

HEALTH

Pledge to recruit thousands more doctors and nurses.

Raise legal smoking age every year to prevent anyone aged under 16 ever being able to legally take up the habit.

Increasing the role of pharmacists to free up millions of GP appointments.

Building 50 new diagnostic centres and 100 new GP surgeries.

A £86,000 cap on social care costs.

EDUCATION AND CHILDREN

Ban the teaching of ‘contested’ gender ideology in schools. Double the income threshold at which families start to lose child benefit from £60,000 to £120,000.

Scrap ‘Mickey Mouse’ degrees to release funding for extra 100,000 apprenticeships.

IMMIGRATION

Introduce a new legal cap on immigration, with MPs voting each year on the total number of visas which should be issued. 

Press ahead with the plan to send Channel migrants to Rwanda next month with ‘a regular rhythm of flights every month’. 

A vow to halve immigration over an undisclosed timeframe and then keep cutting it year-on-year.

No firm commitment to pull out of the jurisdiction of the European Court of Human Rights.

Pledge to ‘work with other countries to rewrite asylum treaties to make them fit for the challenges we face’. 

DEFENCE 

Guarantee that defence spending will rise to 2.5 per cent of GDP by 2030.

Return the civil service to its pre-pandemic size to ‘pay for our commitment to increase defence spending’. 

Introduce National Service for all 18-year-olds that will see them either do a year in the military or weekend unpaid work.

PENSIONS 

Triple Lock Plus to raise personal allowance for pensioners to ensure the basic state pension is never hit by income tax.

POLICE AND CRIME 

Recruit an extra 8,000 police officers to beef up neighbourhood policing.

Increase the minimum tariff for murders in the home from 15 years to 25.

Step up stop and search powers to tackle knife crime.

TRANSPORT 

A fund of £8.3 billion to ‘fill potholes and resurface roads’ 

HOUSING 

 

 

 

‘We will ensure that we have lower welfare so we can lower taxes.’

The PM added: ‘Keir Starmer takes a very different view. 

‘He says he’s a socialist, and we know what socialists always do: take more of your money.’

Pointing to the Stamp Duty move, Mr Sunak said: ‘We Conservatives believe in tax cuts.

‘We’ll also introduce a new form of Help to Buy – a new Help to Buy scheme – to get the new generation onto the property ladder, all part of our plan to build an ownership society, where more and more people have the security and pride that comes from owning your own home.

‘From Macmillan to Thatcher to today, it is we Conservatives who are the party of the property-owning democracy in this country.’

The manifesto states: ‘Our long-term ambition, when it is affordable to do so, is to keep cutting national insurance until it’s gone, as part of our plan to make the tax system simpler and fairer.

‘As the next step in that plan, we will cut employee national insurance to 6 per cent by April 2027 – meaning that we will have halved it from 12 per cent at the beginning of this year, a total tax cut of £1,350 for the average worker on £35,000.

‘This comes on top of the significant above-inflation increase to the personal allowance we have delivered since 2010, nearly doubling it from £6,475 to £12,750.’

It adds: ‘As well as cutting national insurance for 29 million people, we will also not raise the rate of income tax or VAT.’

On the ‘national living wage’, the Conservatives said they will ‘maintain’ it in ‘each year of the next Parliament at two-thirds of median earnings’ before noting: ‘On current forecasts, that would mean it rising to around £13 per hour, up from a minimum wage of £5.80 under Labour in 2010.’

The manifesto commits to returning the civil service to its pre-pandemic size to ‘pay for our commitment to increase defence spending to 2.5% of GDP’.

It adds the party also wants to halve the amount of taxpayers’ money spent on external consultants and ‘introduce controls on all ‘equality, diversity and inclusion’ initiatives and spending.’

A further 25,000 civil servants would be moved outside London, the manifesto adds.

Ministers hope that today’s manifesto launch will turbocharge a Conservative campaign which has so far failed to dent Labour’s massive lead in the polls.

Yesterday the PM sought to draw a line under the row about his decision to come home early from last week’s D-Day events in Normandy.

He said he ‘absolutely didn’t mean to cause anyone any hurt or upset’ and appealed to people to ‘find it in their hearts to forgive me’.

Mr Sunak said critics were wrong to ‘write me off’ and vowed to fight ‘until the last day of the campaign’ to keep Sir Keir Starmer out of No 10.

Today he acknowledged the Government has raised the tax burden to record levels to pay for Covid spending and support payments during the energy crisis.

But he insisted that, with the economy now stabilised, it is time to start cutting taxes again. 

The PM also highlight how his tax cuts will be funded in large part by a £12billion crackdown on welfare and a new drive against worklessness.

Writing in The Telegraph, Mr Sunak said of the housing plans: ‘For too many of our young people, no matter how hard they work, home ownership can seem out of reach. 

‘I remember getting the keys to my first flat – it’s a special memory to me. And, like millions before and millions after me, it is a moment I will always treasure. I want as many people as possible to have that opportunity, to feel that sense of ownership.’ 

The manifesto will also guarantee that the basic state pension will never be taxed.

For Help to Buy, the plans will allow first-time buyers to have a deposit of 5 per cent. 

They will need a mortgage for 75 per cent of the outstanding cost, with the Government and developers lending the rest at a discount.

But the likes of Mr Jenrick and Ms Braverman are said to be watching the announcement with bated breath to see how the manifesto goes down with the public before deciding to act, The Guardian reported. 

Tory insiders say they could call a press conference next week if it flops, in which they would set out a series of alternative pledges. 

Mr Sunak’s approval rating fell by 12 percentage points as he became less popular than Mr Farage.

The Reform UK leader saw his rating rise from 12 points to 15 across the same period, putting him ahead of the Prime Minister for the first time with voters.

In a special BBC Panorama interview, Mr Sunak declared he will ‘keep cutting people’s taxes’ if he stays in power, with rumours of bold moves on national insurance and stamp duty.

Tory right rivals such as Suella Braverman are waiting in the wings and threatening to swoop if the manifesto flops

Tory right rivals such as Suella Braverman are waiting in the wings and threatening to swoop if the manifesto flops

Mr Sunak has pledged to be 'the party of Margaret Thatcher' - 'a party, unlike Labour, that believes in sound money'

Mr Sunak has pledged to be ‘the party of Margaret Thatcher’ – ‘a party, unlike Labour, that believes in sound money’

Mr Sunak was told Nigel Farage was 'coming for him' as he pleaded with voters to realise that voting for any other party helped Labour

Mr Sunak was told Nigel Farage was ‘coming for him’ as he pleaded with voters to realise that voting for any other party helped Labour

‘You’ll see that in our manifesto tomorrow,’ the PM said. 

Denying he was the political equivalent of a ‘quinoa salad’ to Nigel Farage’s ‘Sunday roast’, Mr Sunak begged voters to remember that the only two politicians who could end up in No10 on July 5 were him and Keir Starmer.

After being shown images of other world leaders and Lord Cameron at D-Day events in Normandy last week, Mr Sunak repeated his grovelling apology for failing to stay until the end.

In tetchy exchanges with presenter Nick Robinson, the premier said he hoped people could ‘find it in their hearts’ to forgive him.

Amid rising Tory alarm about the fallout from the D-Day row, Mr Sunak said: ‘Well, the last thing that I wanted to do was cause anyone any hurt or offence or upset, which is why I apologised unreservedly for the mistake that I made.

‘And I can only ask that I hope people can find it within their hearts to forgive me and also look at my actions as Prime Minister to increase investment in our armed forces, to support our armed forces, but also to ensure that veterans have a minister sitting around the Cabinet table with unprecedented support to make this the best country in the world to be a veteran as a demonstration of how deeply I care about this community and what they’ve done for our country.’

After Robinson jibed that Mr Sunak was the political equivalent of a ‘quinoa salad’ compared to Mr Farage’s ‘Sunday roast with all the trimmings’, the premier argued that ‘there’s only going to be one of two people who’s prime minister’.

‘A vote for anyone who’s not a Conservative candidate is just making it more likely that Keir Starmer is that person,’ he said.

‘So if you ask someone, you say, you know, what makes a Conservative, if you are someone who wants lower taxes, if you want your pension protected, if you want migration reduced, if you want a sensible approach to net zero that prioritises our security and reducing people’s bills, that’s what I will offer you in this election.’

After being shown images of other world leaders and Lord Cameron at D-Day events in Normandy last week, Mr Sunak repeated his grovelling apology for failing to stay until the end

After being shown images of other world leaders and Lord Cameron at D-Day events in Normandy last week, Mr Sunak repeated his grovelling apology for failing to stay until the end 

Mr Sunak is scrambling to get the Tories' election campaign back on track today after the D-Day shambles and with infighting flaring over the Reform threat

Mr Sunak is scrambling to get the Tories’ election campaign back on track today after the D-Day shambles and with infighting flaring over the Reform threat 

Mr Sunak said he did not want to talk about personalities when challenged further on Mr Farage, adding: ‘I’m willing to talk about everything here, but the simple issue here is a vote for anyone else, including Nigel Farage’s party – and I would make the same point about anyone’s party – is ultimately a vote that makes it more likely that Keir Starmer is in power.’

The premier was also pressed on his response to an alleged ‘dog whistle’ attack from Mr Farage suggesting that he did not understand ‘our culture’.

‘Is he playing with fire by bringing your heritage into this argument?’ the presenter asked.

Mr Sunak replied: ‘Well Nigel Farage can answer what he exactly meant by those comments.

‘I’m not going to get involved in that because I don’t think it’s good for our country or good for our politics. Now obviously I disagree with him and when it comes, specifically, to our Armed Forces, again people can judge me by my actions.’

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