Liz Truss tax hike for families: The Tory leadership contender promises to offer a £2,500 break to help those taking time off work to look after loved ones when she becomes Prime Minister
- The foreign secretary promises an overhaul of the tax system when she becomes prime minister
- Ms Truss made the claims in Channel 4’s Conservative Leadership Debate
- She promised £30billion worth of tax cuts as she tried to get her campaign off the ground
- The MP said she wanted to make sure parents aren’t penalized for looking after their children
Families would be offered a tax credit of up to £2,500 under plans being considered by Liz Truss.
That Tory The contender for the leadership today promises a radical overhaul of the tax system if she becomes prime minister.
She wants to make sure parents aren’t penalized for taking the time to care for family members. Couples with young children or caring responsibilities would be among those who could share their personal tax credits under the plan.
That foreign minister tonight promised a tax cut bonanza worth more than £30billion in a dramatic attempt to make her campaign a success Boris Johnson back on track.
Liz Truss, pictured here during today’s Conservative leadership debate on Channel 4, has vowed to overhaul the tax system if she becomes Prime Minister
Ms Truss, pictured here alongside fellow Tory MP Tom Tugendhat during tonight’s debate, promised a tax cut bonanza worth more than £30billion
She pledged to remove environmental taxes from energy bills, scrap a proposed corporate tax hike and reverse a Social Security hike.
And Miss Truss says she would take immediate action to “put the money back in people’s pockets” as they struggle with rising inflation.
Speaking to the Daily Mail, she promises to go further by launching an immediate review of the tax system when she steps into No10.
The Treasury would be directed to explore an opt-in system that would allow members of the same household to share their tax credits. The change could be introduced as early as next year’s budget.
Ms Truss said: “Families are an essential part of our lives and the crucial building block for a stable society. Not only do they take care of themselves, they also build communities, charities and even businesses. We will review family taxation to ensure people are not penalized for taking time out to look after their children or elderly relatives.’
Ms Truss said the Treasury Department is being directed to explore an “opt-in” scheme that would allow members of the same household to share their tax breaks. Pictured left to right are Kemi Badenoch, Penny Mordaunt, Rishi Sunak, Liz Truss and Tom Tugendhat
For other developments:
- The race for leadership exploded last night when Miss Truss and Rishi Sunak clashed over taxes in the first televised debate;
- She squashed his Social Security surge and warned, “You can’t tax your way to growth”;
- Suella Braverman urged MPs who supported her to rally behind Miss Truss after she was knocked out of the running.
- Rival Penny Mordaunt tried to shrug off the dispute over her “awakened” views on trans rights by insisting her position was “simple and straightforward”;
- Scientists have raised concerns that Miss Mordaunt supported the ‘wrong’ treatment of homeopathy in the NHS;
- It turned out that Rishi Sunak, the front runner in the race for leadership, had privately campaigned for a green tax on fuel last year;
- A leaked memo showed that the ex-chancellor also “blocked” a review to abolish the television license fee, although he claimed to be open to the idea;
- China’s biggest state tabloid praised Mr Sunak for not taking a “very tough stance” on Beijing.
Plans put forward by Miss Truss to allow households to share their personal tax credits would accelerate the existing tax break for married couples first promised by David Cameron in 2005.
Currently, a member of a married couple earning below the income tax threshold of £12,570 can transfer £1,270 of their allowance to their spouse, reducing their tax bill by up to £252 a year.
The review proposed by Miss Truss would aim to extend eligibility to all cohabiting couples while drastically increasing the tax break.
Treasury officials will consider allowing people to transfer their full personal allowance of £12,570 to a partner.
This would be worth up to £2,514 per year per couple.
Parents who stay at home or work part-time would be among the top winners. In an online husting yesterday, Miss Truss offered a triple £32.7 billion tax cut if she became Prime Minister. It would reverse the Social Security increase introduced by Mr. Sunak in April. “It’s even more of a mistake now when we’re facing such severe economic headwinds,” she told the Conservative Home Event.
She also announced a temporary suspension of the green electricity levy, which would cut energy bills by £153.
Miss Truss added, “I wouldn’t raise corporate taxes either, because it’s vital that we attract investment to our country.”
The increase from 19 per cent to 25 per cent next year is expected to bring in more than £16bn a year, while reversing the increase in Social Security would cost £12.5bn and eliminating environmental taxes is estimated at £4.2bn.
Mr Sunak, who has been criticized for his heavy spending and high taxation during the pandemic, argued at the same event that he would only make tax cuts if inflation is under control.
Laura Suter, head of personal finance at AJ Bell, said Miss Truss’ tax break proposal would help families but “added complexity to an already very complex tax system”.
