[ad_1]
Is Rishi lining up ‘Windfall Tax Lite’? Chancellor ‘examines plans for a one-off hit’ on oil and gas firms in a bid to appease Tory opponents and help ease the cost-of-living crisis
- Rishi Sunak and the PM ‘privately open-minded about the idea of a windfall tax’
- Tory MPs told not to criticise windfall tax online âbecause a U-turn is in the offingâ
- Tax bill for companies would be lowered if they invest profits into UK economyÂ
Chancellor Rishi Sunak is examining plans for a âWindfall Tax Liteâ to appease Tory opponents of a one-off hit on oil and gas firms.
Under proposals being drawn up by Treasury officials, the tax bill would be lowered for companies investing a high proportion of their profits back into the British economy to increase the UKâs domestic energy supplies and reduce our dependence on other countries.
Both Mr Sunak and Boris Johnson are understood to be privately open-minded about the idea of a windfall tax, despite resistance within the Cabinet, on the backbenches and among senior Downing Street advisers. Yesterday Mr Sunakâs predecessor as Chancellor, Health Secretary Sajid Javid, was the latest senior figure to make clear his opposition, saying: âI donât like the idea.â
![Chancellor ‘examines plans for a one-off hit’ on oil and gas firms’ Chancellor ‘examines plans for a one-off hit’ on oil and gas firms’](https://i.dailymail.co.uk/1s/2022/05/21/22/58114083-10840983-image-m-32_1653167999255.jpg)
Chancellor Rishi Sunak is examining plans for a âWindfall Tax Liteâ to appease Tory opponents of a one-off hit on oil and gas firm
Some Tory MPs have been privately advised by party managers not to go onto social media to criticise a windfall tax âbecause a U-turn is in the offingâ.
The debate comes against the backdrop of renewed tensions between No10 and No11, with some Downing Street officials feeling that Mr Sunak is âinsufficiently galvanisedâ to tackle the cost of living crisis. They were particularly suspicious about a report in The Times on Friday claiming âsome Toriesâ think it might âbe better to lose the next electionâ as the party needs time in opposition âto refreshâ.
A source said: âThat had Rishiâs fingerprints all over it. He would much rather be Tory leader in opposition than at the fag end of a Conservative Government.â
The claim is strongly denied by Mr Sunakâs aides, who say that the Chancellor is âfully supportive of the Government and tied to the Prime Ministerâs fortunesâ.
Opposition to the tax is being led by two of Mr Johnsonâs most senior advisers â David Canzini and Andrew Griffith, the head of the policy unit â who are âimplacably opposedâ on the grounds that it is âun-Conservativeâ.
![Opposition to the tax is being led by two of Mr Johnsonâs most senior advisers â David Canzini and Andrew Griffith, the head of the policy unit (pictured)â who are âimplacably opposedâ on the grounds that it is âun-Conservativeâ](https://i.dailymail.co.uk/1s/2022/05/22/00/58117125-10840983-Opposition_to_the_tax_is_being_led_by_two_of_Mr_Johnson_s_most_s-a-16_1653177442783.jpg)
Opposition to the tax is being led by two of Mr Johnsonâs most senior advisers â David Canzini and Andrew Griffith, the head of the policy unit (pictured)â who are âimplacably opposedâ on the grounds that it is âun-Conservativeâ
Mr Johnson, described by one friend as âbasically a Liberal Democrat at heartâ, is said to be âmore persuadableâ, particularly after seeing private polling showing the idea was backed by more then three quarters of voters. He is also said to be irritated by the reluctance of firms such as BP and Shell to voluntarily reinvest their vast profits.
The Prime Minister thinks the proceeds should be used to invest in new nuclear power stations and renewable energy sources, rather then provide a short-term boost to householdsâ disposable income through bill rebates or cuts to fuel duty or income tax. Modelling for the windfall tax shows it would generate around £150 per household.
Mr Sunakâs allies reject the idea that he is âinsufficiently galvanisedâ over the soaring cost of living, which has led to mounting unease among Tory MPs over the impact on them at the ballot box. The allies say pumping more money into the economy to help households risks pushing up inflation even higher.
The recent rises in interest rates, which now stand at 1 per cent, have increased the amount which the Treasury pays in debt repayments by £8billion a year. By comparison, it would cost the Chancellor around £5billion to £6billion to introduce a 1p cut in interest rates.
Senior sources expect a cost of living package to be unveiled shortly after the Queenâs Platinum Jubilee celebrations, to take effect when bills rise again in the autumn.
When asked about the windfall tax yesterday, Mr Javid said: âInstinctively I donât like it. We have a very hard-won but strong reputation for being pro-business and welcoming investment.
âBuinesses like certainty. We have got to be really careful about these sudden taxes that could have an impact in the long term that we come to regret.â
Advertisement
[ad_2]
Source link