Saturday, May 14, 2022

Tory hits Rishi Sunak over unexpected taxes and cost of living crisis

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MEPs believe the chancellor will be forced into an embarrassing about-face over a levy on oil and gas companies, while Mr Sunak is under pressure to do more to help beneficiaries

Grassroots Conservative MPs and organizers want more done to support family budgets after voters turned away from the party in last week’s local elections, a minister said.

Rishi Sunak is facing rising discontent among Tory MPs over the cost of living crisis, with many believing he will be forced into an embarrassing about-face over an unexpected tax on oil and gas companies.

The failure of a new plan to tackle rising inflation and energy costs in the Queen’s speech has hardened some Tory MPs’ views of the Chancellor and Boris Johnson.

A minister said the party was “still very angry” and that the Treasury aimed to provide aid where it was needed and that no extra effort was being made to help those on welfare.

Some Conservative MPs have gone public to call for a windfall tax. On Thursday, Mr Sunak hinted a reversal might be imminent when he said he would be “pragmatic” on the issue.

Robert Halfon, Conservative MP for Harlow, said I: “Most MEPs recognize and want more to be done on the cost of living. Many are very concerned that the Treasury Department is not up to the challenges ahead. The party is still very angry. Many members are fed up.”

On the prospect of an unexpected tax, the minister said: “[Tory] The grassroots recognizes that more is needed for people on fixed incomes who are unable to work or trapped with low wages.

“I would say most are not opposed to the idea of [windfall] taxes, but would be unfazed by another reversal. It gives weight to the idea that we don’t have a plan [just] focused on immediate headlines. Treasury targeting was poor.”

But a senior Tory MP warned about a windfall tax and told the story I: “We have the highest tax burden in decades, so perhaps try to take advantage of the existing massive amount we’re taking from taxpayers and businesses before considering another tax hike.”

“Also, it’s annoying that they’re running all over the place again – one minute no, the next maybe. The trolley is on its way again. The PM is to blame for not knowing what to do. [But] Rishi should know better than to play the populist. People see through that.”

Mr Sunak claimed yesterday that he was unable to increase social benefits this year to protect them from the worst effects of the cost of living crisis due to the government’s old computer system.

In an interview with Bloomberg TV, the Chancellor said: “The operation of our welfare system is technically complicated.

“That’s not necessarily possible [increase benefits] For each. A lot of the systems are built to only be done once a year and the decision was made quite a while ago.”

Mr Sunak admitted that blaming IT “sounds like an apology” but insisted he was “somewhat constrained by how the welfare system works”.

Because of the way benefits are linked to last year’s inflation, millions of people in April saw a rise of just 3.1 percent while inflation soared over 7 percent.

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