Calendar An icon of a desk calendar. Cancel An icon of a circle with a diagonal line across. Caret An icon of a block arrow pointing to the right. Email An icon of a paper envelope. Facebook An icon of the Facebook "f" mark. Google An icon of the Google "G" mark. Linked In An icon of the Linked In "in" mark. Logout An icon representing logout. Profile An icon that resembles human head and shoulders. Telephone An icon of a traditional telephone receiver. Tick An icon of a tick mark. Is Public An icon of a human eye and eyelashes. Is Not Public An icon of a human eye and eyelashes with a diagonal line through it. Pause Icon A two-lined pause icon for stopping interactions. Quote Mark A opening quote mark. Quote Mark A closing quote mark. Arrow An icon of an arrow. Folder An icon of a paper folder. Breaking An icon of an exclamation mark on a circular background. Camera An icon of a digital camera. Caret An icon of a caret arrow. Clock An icon of a clock face. Close An icon of the an X shape. Close Icon An icon used to represent where to interact to collapse or dismiss a component Comment An icon of a speech bubble. Comments An icon of a speech bubble, denoting user comments. Ellipsis An icon of 3 horizontal dots. Envelope An icon of a paper envelope. Facebook An icon of a facebook f logo. Camera An icon of a digital camera. Home An icon of a house. Instagram An icon of the Instagram logo. LinkedIn An icon of the LinkedIn logo. Magnifying Glass An icon of a magnifying glass. Search Icon A magnifying glass icon that is used to represent the function of searching. Menu An icon of 3 horizontal lines. Hamburger Menu Icon An icon used to represent a collapsed menu. Next An icon of an arrow pointing to the right. Notice An explanation mark centred inside a circle. Previous An icon of an arrow pointing to the left. Rating An icon of a star. Tag An icon of a tag. Twitter An icon of the Twitter logo. Video Camera An icon of a video camera shape. Speech Bubble Icon A icon displaying a speech bubble WhatsApp An icon of the WhatsApp logo. Information An icon of an information logo. Plus A mathematical 'plus' symbol. Duration An icon indicating Time. Success Tick An icon of a green tick. Success Tick Timeout An icon of a greyed out success tick. Loading Spinner An icon of a loading spinner.

Truss promises tax cuts not ‘handouts’ to tackle cost-of-living crisis

Tory leadership hopeful Liz Truss (PA/Finbarr Webster)
Tory leadership hopeful Liz Truss (PA/Finbarr Webster)

Liz Truss has said she would help people with the cost-of-living crisis by lowering taxes, not giving “handouts”.

The Tory leadership hopeful was asked whether she would offer more help with spiralling fuel bills this winter if she becomes the next prime minister.

The Foreign Secretary told the Financial Times she would of course “look at what more can be done” but said she would do things in a “Conservative way”.

Ms Truss rejected the idea of giving “handouts”, promising to implement tax cuts instead.

She told the publication: “Of course, I will look at what more can be done. But the way I would do things is in a Conservative way of lowering the tax burden, not giving out handouts.”

Her comments come against a backdrop that is growing starker by the day.

This week, energy consultancy Auxilione said the Government’s price cap, which sets bills for more than 20 million households in Britain, could reach nearly £4,000 a year from January.

New analysis from the Office for National Statistics (ONS) also shows that close to half (44%) of UK adults who pay energy bills found it very or somewhat difficult to afford them in the last two weeks of July.

The Bank of England warned on Thursday the UK faces two years of falling household incomes, with inflation set to soar to more than 13% and the economy to relapse into the longest recession since the financial crisis.

At a Tory leadership hustings in Eastbourne, Sussex, on Friday evening, Ms Truss suggested her plans for immediate tax cuts could avert a recession.

So far, the Foreign Secretary has pledged to halt “green levies” on energy bills, reverse the national insurance hike and cancel the planned corporation tax rise.

She told Tory members: “I know there are difficult forecasts out there but forecasts are not destiny. And what we shouldn’t be doing is talking ourselves into a recession. We should be keeping taxes low.

“We can create the British version of Silicon Valley. We can create real opportunities.”

However, her rival Rishi Sunak argued that unless inflation is brought under control there is “no hope” the Tories will win the next election.

Conservative leadership bid
Liz Truss during the hustings in Eastbourne (Gareth Fuller/PA)

Taking a thinly veiled swipe at his opponent, Mr Sunak told the hustings he is “particularly worried about policies that risk making it (inflation) worse and last longer”.

The former chancellor said: “Well, the first thing we need to do in order to make sure we can win that election is have got through this inflation problem by then.

“And that’s why I’m particularly worried about policies that risk making it worse and last longer.

“Because this is a problem that isn’t just for this winter. It’s a problem for next winter as well, and beyond.

“Because as the Bank of England said, they are worried about inflation becoming embedded – then there’s no hope that we’re going to win that next election. Absolutely none. It’s as simple as that.”

He also insisted corporation tax is not the “right tax” to focus on, instead speaking about the need to reform business taxes to “cut them on the things that make a difference”.

Mr Sunak said: “I don’t want to stick with the failed policies of the past. That’s what some people are suggesting. It hasn’t worked.”

He added: “Investment in this economy today, no better than it was a decade ago, in spite of us doing all those things on corporation tax.

“Because it’s not the right tax to focus on. And that’s where my experience in business, my time as chancellor, my conversations with business, have led me to the conclusion we need to be much more radical.

“We need to reform business taxes to cut them on the things that make a difference.”

On Friday night, the Foreign Secretary received the backing of two Conservative former ministers, Nus Ghani and Dame Andrea Leadsom.

Ms Ghani told Tory members in Eastbourne that because of her role as the vice-chairwoman of the 1922 Committee of backbench Conservative MPs, she had not been able to back a candidate until this stage of the race.

Dame Andrea, who served as Penny Mordaunt’s campaign manager and as business secretary, wrote in the Telegraph that Ms Truss would make sure “every baby is given the best start for life”.

Conservative leadership bid
Rishi Sunak during the hustings event (Gareth Fuller/PA)

As she attends the Commonwealth Games in Birmingham later, the Foreign Secretary is expected to set out a series of economic reforms which her campaign team claims will “promote regional growth by reviewing funding to supercharge the right kind of investment”.

Some of the reforms include reviewing the levelling-up formula to fix underinvestment in regional infrastructure and create low tax, low regulation “investment zones” or “full-fat freeports” on brownfield sites.

However, a campaign spokesman for Mr Sunak accused Ms Truss’s team of “copy and pasting” policies the former chancellor had already put in place.

The spokesman said: “Not only are Team Truss copy and pasting policies put in place by Rishi himself, but they are also re-announcing two-year-old government policies.

“Imitation is the best form of flattery, as the saying goes.”

Mr Sunak’s camp argued “investment zones” are simply a copy and paste of the freeports he pioneered as chancellor and that Ms Truss’s plan to review the levelling-up formula comes nearly two years after he reformed it.