The state is crumbling and yet the Tories pretend we can afford fresh tax cuts

HOW can a nation that has enjoyed no productivity growth in 15 years, is still reeling from the economic shocks of Brexit, Covid and Russia’s full-scale invasion of Ukraine and where debt is equivalent to 100 per cent of GDP, afford sweeping tax cuts? The short answer is: it can’t. The longer answer is the same, but involves several hundred words about the internal dynamics of the Conservative Party.

- Jack Kessler

Last November, the Chancellor, Jeremy Hunt, cut taxes. Not by as much as he had raised them, of course. This is still set to be the most tax-raising parliament in history. But by taking 2p off the main rate of National Insurance, he pulled the trigger on the Tories’ general election strategy. And he’s not done yet.

Should there be money to spend in the spring, or “fiscal headroom”, expect a cut to income tax, perhaps repeal of inheritance tax. And a fuel duty freeze, as is now constitutionally mandated.

As far as political strategy goes, tax cuts make some sense. It is one of the few policies that unites the Tories. And it’s not as if Rishi Sunak can go to the country pointing to his success in boosting living standards or stopping the boats. Moreover, tax cuts pose a challenge to Labour.