Sunday, June 26, 2022

Rishi Sunak plans to unveil fiscal measures before the summer to deal with the cost-of-living crisis

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The Chancellor is expected to use early fuel price data to determine what additional support he might introduce in the coming weeks

The Chancellor is expected to use fuel price data, which offers a first look at the energy price cap, to help determine what additional support he could introduce to help families cope with rising bills.

Chancellor Rishi Sunak is preparing to announce fiscal measures to help with the cost-of-living crisis before parliament dissolves for the summer. I understands.

While the October energy price cap will not be set until August, early data in the coming weeks will give Treasury a clearer idea of ​​the scale of the challenge.

Treasury Department sources said Mr Sunak had made it clear that if he knew more about energy price changes, he would take action to help households and they had not denied plans for fiscal intervention before MPs disband in July.

However, these measures are not expected to take the form of an emergency budget and will not include tax or VAT changes.

Instead, they could include more targeted measures to help those most vulnerable – such as additional relief for pensioners or beneficiaries. The Sunday Times reported that Mr. Sunak is also considering lowering tariffs on imported food.

Meanwhile David Canzini, Boris Johnson’s deputy chief of staff, has asked assistant ministers to propose five “non-fiscal measures” the government could introduce before the summer.

A Treasury source said: “Chancellor has always made it clear that if we know more about energy prices before the next price cap hike, we will look at ways we can help people with that. On the other hand, we are only halfway through the forecast period.”

In a piece for them Sunday ExpressMr Sunak said: “I have always said that I am ready to take further action if we get more information about the pressures we are likely to face later this year.”

Asked if they would expect the Chancellor to announce a one-off spending measure to support the cost-of-living crisis outside of a formal budget in the coming weeks, a Whitehall source said: “Yes. Check out what Rishi wrote in the Sunday Expresswhich means more help is coming.”

The energy cap will be set at prices observed between February 1st and July 31st and experts have already predicted prices could rise by £600 by October.

However, the predictions are becoming more accurate as July approaches, giving Mr. Sunak more confidence in deciding on emergency response.

Labor, meanwhile, is proposing an amendment to the Queen’s speech that would see energy giants face a windfall tax, with the money then used to help families in need.

Several Tory MPs have expressed support for such a measure and the Treasury has continued to insist nothing is out of the question.

However, Boris Johnson is said to be reluctant to impose the one-off tax and Business Minister Kwasi Kwarteng said he does not support such measures.

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