Hunt urged to cut taxes after burden on households rises by £821

By Nick Gutteridge and Charlotte Gifford

2023-01-25T08:00:00.0000000Z

2023-01-25T08:00:00.0000000Z

Daily Telegraph

https://dailytelegraph.pressreader.com/article/281509345314638

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HOUSEHOLDS have paid an average of £821 more in taxes this financial year, according to figures that will add to pressure on the Chancellor to cut taxes this spring. HM Revenue and Customs statistics analysed for The Daily Telegraph reveal the Exchequer raised £553 billion between April and December, an annual increase of 10 per cent. Senior Tory MPS said the numbers demonstrated the need for the Chancellor to reduce the burden on families and businesses at his March 15 Budget. The figures show income tax and national insurance receipts, including contributions paid by employers, surged to £281billion in the first nine months of this tax year, a £34billion increase. It comes as the Government’s spending watchdog warned the country is facing a multi-billion pound hole ahead of the budget in March. In a private submission to the Treasury, seen by The Times, the Office for Budget Responsibility (OBR) told Jeremy Hunt that it plans to revise growth forecasts down by between 0.2 and 0.5 per cent, owing to weakness in the economy and labour market shortages. Meanwhile the Government is to bring in a record amount from inheritance tax with bereaved families having paid out £5.3billion so far. Experts have said the numbers are on course to surpass the £6.1billion raised in 2021-22, after the Exchequer raked in £545million in December alone. Revenue from stamp duty also hit an all-time high, with house buyers forking out more than £15.7billion, according to analysis by the tax firm RSM. Analysts said the amount paid in personal taxes including income tax, national insurance, capital gains and inheritance tax rose by 11.45 per cent to £23billion. When this is averaged out across the 28.1 million UK households, the cost per family is an additional £821. Overall the figures represent the second biggest year-on-year rise in the tax take outside of the Covid pandemic since 2010, when the economy was emerging from the financial crisis. The figures take into account Mr Sunak’s decision, while Chancellor, to freeze income tax thresholds. However, they do not capture the full impact of Mr Hunt’s decision, made in November, to extend the freeze until 2028, which will bring £26billion to the Treasury. The OBR said inflation-fuelled wage rises would result in 2.6million people starting to pay tax over the next five years and 3.2million will be dragged into the 40p bracket. Senior Tory MPS said the Chancellor should take advantage of the tax windfall to cut the burden on businesses “ASAP” and boost the economy, creating more jobs. Sir Iain Duncan Smith, a former Conservative leader, said: “Tax revenues go up off the back of a growing economy. As inflation comes down, the economy needs a dose of growth otherwise companies will leave. With figures like this what we need to be saying is these companies are struggling, we need to help them with lower taxes ASAP.” John Redwood, who was head of the No 10 policy unit under Margaret Thatcher, said Mr Hunt should reduce corporation tax and green levies which push up energy costs. “They’ve got plenty of flex from tax revenues and expenditure items which should mean that they can afford tax reductions,” he said. “Grow the cake is what you’ve got to do.” Meanwhile official data published yesterday showed public borrowing hit a record £27.4billion last month. The Office for National Statistics (ONS) said the increase was driven by £7billion paid out by the energy support scheme and the soaring cost of servicing the national debt, which rose to £17.3billion. The watchdog has forecast that the interest bill on government borrowing will hit £116billion in this financial year alone. Mr Hunt, who has resisted calls for tax cuts on the basis they could stoke inflation, said the numbers showed the Government must stick to its economic plan. The figures also come as the Chancellor is understood to be poised to announce he is bringing forward by up to a decade the raising of the state retirement age to 68. Here’s a litmus test that will separate the men from the boys. A senior aide to Japan’s prime minister has apologised for putting his hands in his pockets during an official trip to the US, after his mother scolded him and told him she was “ashamed” of him. She also suggested that he sew shut the aforementioned pockets to avoid temptation in future. Oh, and if it helps your decision-making process, the aide, Seiji Kihara, is not only the deputy chief cabinet secretary, but 52 years old. So should she pipe down or should he close up? The correct answer, of course, is: do what your damn mother tells you. Because when it comes to optics on the international stage, your wedding day or your first date, she is always right. And if not entirely beyond-all shadow right, then at the very least a lot righter than you, sunshine. I’m glad Kihara was man enough to apologise like a little boy. But while this particular battle may have been won, the incivility war rages on. Young people (I love the idea of still being an enfant terrible past 50) have always pushed the boundaries of what’s acceptable. They are hardwired to slouch, mumble and look bored. I’m sure Horace epistled about that very subject. Or maybe it was Nanny Mcphee? Either way, a certain amount of leeway is often afforded to the next generation, whether it recognises the concession or not. But there comes a point where established etiquette takes precedence over personal choice, and “feeling comfortable” comes second to “looking the part”. I believe the concept of looking smart, acting smarter and recognising the dignity of an occasion is what’s mockingly described these days as “adulting”. Not to be confused with a juvenile refusal to do what is expected – simply because it is expected. Hands in pockets isn’t big, clever or funny. It’s not a subliminal signal that you are cool, a maverick or simply above the clichés of pomp and protocol. It’s rude. It’s embarrassing. Wiser heads, needless to say, have always watched in despair and exasperation as their successors sought to rewrite the rule books on pretty much everything. And yes, times do change. But slowly. And only to a degree. Queen Elizabeth, the late Queen Mother, is said to have once warned the late Queen that informal poses, showing the royal hands thrust into pockets, would have the power to “bring the monarchy down”. There is a picture of just such a relaxed, smiling moment in Angela Kelly’s memoir, The Other Side of the Coin: the Queen, the Dresser and the Wardrobe. Her late Majesty looks radiant in her white dress, but this was a rare shot; she always looked and behaved impeccably in public. Unfortunately the Duchess of Sussex, a self-confessed “hugger” with a casual (verging on contrarian) approach to life in the Firm, found herself heavily criticised for having the temerity to put her hands in her pockets on official occasions. Did nobody tell her? Or was it just a case of Meghan getting what Meghan wanted? Pockets have their place. Brides magazine last year devoted acres of space to wedding gowns with pockets and, contrary to expectations, they didn’t look awful. Utility meets beauty – and somewhere to hide a stick of lip balm or peppermint. But no mother on the planet would let her child, whether bride or groom, pose for their Big Day pictures with their hands dug deep. Pockets of resistance are futile.

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