Liz Truss’ tax boost for families: Tory leadership contender makes pledge to offer break of £2,500 to help those who take time off work to care for loved ones if she becomes Prime Minister
- The Foreign Secretary vows an overhaul of the tax system if she becomes PM
- Ms Truss made the claims in the Channel 4 Conservative Leadership Debate
- She promised a tax cuts worth £30 billion as she tried to get her campaign going
- The MP said she wants to ensure parents aren’t punished for caring for their kids
Families would be offered a tax break of up to £2,500 under plans being considered by Liz Truss.
The Tory leadership contender today pledges a radical overhaul of the tax system if she becomes prime minister.
She wants to ensure parents are not penalised for taking time out of work to look after family members. Couples with young children or caring responsibilities would be among those able to share their personal tax allowances under the plan.
The Foreign Secretary tonight promised a tax-cutting bonanza worth more than £30billion in a dramatic bid to get her campaign to succeed Boris Johnson back on track.
Liz Truss, pictured here during tonight’s Conservative Leadership Debate on Channel 4, has vowed to overhaul the tax system if she becomes Prime Minister
Ms Truss, pictured here next to fellow Tory MP Tom Tugendhat during the debate tonight, promised a tax-cutting bonanza worth more than £30 billion
She vowed to axe green levies on energy bills, cancel a planned corporation tax rise and reverse a hike in national insurance.
And Miss Truss says she would take immediate action to start ‘putting money back into people’s pockets’ as they struggle with surging inflation.
Speaking to the Daily Mail, she vows to go further by launching an immediate review of the tax system if she gets into No 10.
The Treasury would be ordered to explore an ‘opt-in’ system allowing members of the same household to share their tax allowances. The change could be introduced as soon as the budget next year.
Miss Truss said: ‘Families are a vital part of our lives and the crucial building block for a stable society. They don’t just look after themselves but also build communities, charities and even businesses. We will review the taxation of families to ensure people aren’t penalised for taking time out to care for their children or elderly relatives.’
Ms Truss said the Treasury would be ordered to explore an ‘opt-in’ system allowing members of the same household to share their tax allowances. Pictured left to right are Kemi Badenoch, Penny Mordaunt, Rishi Sunak, Liz Truss and Tom Tugendhat
In other developments:
- The leadership race exploded into life last night as Miss Truss and Rishi Sunak clashed over tax in the first TV debate;
- She savaged his national insurance rise and warned ‘you cannot tax your way to growth’;
- Suella Braverman urged MPs who had backed her to rally behind Miss Truss after she was knocked out of the race;
- Rival Penny Mordaunt tried to dismiss the row about her ‘woke’ views on trans rights by insisting her position was ‘simple and straightforward’;
- Scientists voiced concerns that Miss Mordaunt supported the ‘bogus’ treatment of homeopathy in the NHS;
- It emerged that Rishi Sunak, the frontrunner in the leadership race, privately lobbied for a green levy on fuel last year;
- A leaked memo showed the ex-chancellor also ‘blocked’ a review into scrapping the TV licence fee despite claiming to be open to the idea;
- China’s largest state tabloid praised Mr Sunak for not taking a ‘very tough stance’ towards Beijing.
Knocked-out Suella urges supporters to back Truss
Suella Braverman has urged Conservative MPs who backed her to rally behind Liz Truss after she was knocked out of the contest.
The Attorney General told her supporters they needed to ‘look realistically at the numbers’.
Mrs Braverman, eliminated in the second round of voting on Thursday, said the Foreign Secretary is best-placed to make it into the final ballot of party members.
She heaped praise on Kemi Badenoch, former equalities minister, calling her a ‘great woman’ who will make a fantastic prime minister ‘one day’.
But she said Miss Truss, who has been in the Cabinet for eight years, is ready to take the reins of power and would not need to ‘learn on the job’.
Mrs Braverman’s appeal will come as a welcome boost to Miss Truss, who needs to win over a significant number of the 27 MPs who backed the Attorney General to make up ground on Rishi Sunak and Penny Mordaunt.
Allies of the Foreign Secretary last night said they were ‘confident’ she would get a ‘good chunk’.
Mark Francois, the chairman of the European Research Group of Eurosceptic MPs, also urged Brexiteers to support Miss Truss.
The plans put forward by Miss Truss to allow households to share their personal tax allowances would turbo-charge the existing tax break for married couples, first promised by David Cameron in 2005.
At present, one member of a married couple who earns under the £12,570 income tax threshold 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 look at extending the eligibility to all cohabiting couples, while dramatically increasing the tax break.
Treasury officials will consider allowing people to transfer their full £12,570 personal allowance to a partner.
This would be worth up to £2,514 a year per couple.
Stay-at-home parents or those who work part time would be among the main winners. At an online hustings yesterday, Miss Truss offered a treble tax cut of £32.7billion if she became PM. She would reverse the national insurance hike introduced by Mr Sunak in April. ‘It’s even more of a mistake now when we’re facing such strong economic headwinds,’ she told the Conservative Home event.
She also announced a temporary suspension of the green energy levy, which would cut £153 from energy bills.
Miss Truss added: ‘I would also not do the corporation tax hikes because it’s vitally important we’re attracting investment into our country.’
The hike from 19 per cent to 25 per cent next year is forecast to bring in more than £16billion annually, while reversing the national insurance rise would cost £12.5billion and the removal of green levies is put at £4.2billion.
Mr Sunak, who has faced criticism for his high spending and high taxation during the pandemic, argued at the same event that he would enact tax cuts only when inflation was under control.
Laura Suter, head of personal finance at AJ Bell, said Miss Truss’s tax break proposal would help families but ‘add complexity to an already very complex tax system’.
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