Pressure grows on Hunt to cut income tax

Pressure is mounting on Jeremy Hunt to cut taxes in tomorrow's autumn statement amid evidence that almost 4 million UK workers are to be dragged into paying income tax for the first time.

- Richard Partington Pippa Crerar

In a crunch week for the government, Rishi Sunak fuelled expectations yesterday that his chancellor could use his speech to the Commons to launch personal tax cuts, saying the government could now "look forward" to the future after progress on the economy.

Any measures would, however, come with the government on course to bring 3.9 million workers into paying income tax by 4 the middle of the decade through a freeze on income tax thresholds, according to research shared with the Guardian by the Joseph Rowntree Foundation (JRF) poverty charity.

Underscoring the impact of the socalled "stealth tax" during the cost of living crisis, it found as many as two-thirds would be from the lowest income half of households in Britain.

The income tax freeze was first announced by Sunak two years ago when he was the chancellor during a push to find budget savings.

Extended by Hunt last year until 2027-28, it has been described as the biggest revenue-raising measure for more than 40 years.

Freezing tax thresholds, rather than allowing them to rise with inflation as is usual, pulls more workers into paying higher rates of income tax when their earnings rise.

Speaking yesterday to announce the next stage of his economic plan, Sunak preempted his chancellor's statement by listing five new priorities for his government - including cutting tax and rewarding hard work.