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Rishi Sunak has told Tory activists that he would only consider cutting taxes once the public finances are on a “sustainable footing” following the coronavirus crisis.
The chancellor, who has faced criticism from Tory allies and political opponents over the scale of the tax burden, said it would be “immoral” to borrow more as he defended his approach.
Boris Johnson began the Conservative conference in Manchester on Sunday by refusing to rule out further tax rises.
On the eve of the conference, Commons Leader Jacob Rees-Mogg – a darling of the Tory right – warned Johnson and Sunak that taxation has hit “the limit”.
Sunak has refused to rule out further hikes and, addressing a packed conference hall in Manchester with Johnson in the audience, defended his approach.
“Our recovery comes with a cost,” he said. “Our national debt is almost 100% of GDP. So we need to fix our public finances.”
Sunak acknowledged that tax rises are “unpopular, some will even say un-Conservative”.
But he added: “I’ll tell you what is un-Conservative: unfunded pledges, reckless borrowing and soaring debt.
“Yes, I want tax cuts. But in order to do that our public finances must be put back on a sustainable footing.”
Sunak said Brexit – “despite the challenges” – meant that in the “long term” the UK would have “agility, flexibility and freedom” and help create “a renewed culture of enterprise”.
In a passing reference to the current crisis facing the government, he said: “Right now we are facing challenges to supply chains, not just here but right around the world and we are determined to tackle them head on.”
Sunak added that “tackling the cost of living isn’t just a political soundbite, it’s one of the central missions of this Conservative government”.
Rising energy bills, an imminent cut to Universal Credit and next year’s national insurance increase will add to pressure on household finances