Hunt eases tax burden with eye on Tory election hopes

MILLIONS of workers will benefit from a 2p cut in national insurance as Jeremy Hunt began to ease the tax burden ahead of the general election.

The Chancellor said the two-percentage-point reduction in the main rate will save someone earning £35,000 more than £450 and the change would benefit 27 million people. Mr Hunt also confirmed that a tax break allowing firms to cut their bills if they invest in new equipment will be made permanent, in what he claimed was the “biggest business tax cut in modern history”.

But both measures come against a backdrop of a tax burden that has risen sharply in recent years as the Tories have contended with the economic impact of Covid-19 and the spike in energy prices triggered by the war in Ukraine.

And high inflation has also contributed to a situation where the independent budget watchdog warned that “living standards are forecast to be 3.5% lower in 2024-25 than prepandemic”.