Sajid Javid wades into Tory tax rise row as he hints at opposition to rates hike

Twitter like: Sajid Javid waded into tax rise row
REUTERS
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Sajid Javid​ has waded into a growing Tory row over the prospect of tax rises in Rishi Sunak’s first Budget.

The former Chancellor nailed his colours to the mast by “liking” a tweet warning that Britain is already “overtaxed” with the highest tax burden for a generation.

His move came amid rumblings of unease on the Tory benches over hints that Boris Johnson wants next month’s Budget to mount a tax raid on Middle England.

“We are not going to win seats back in London by shafting the very people who are most inclined to vote Conservative,” one senior Tory told the Evening Standard.

There have been hints that Boris Johnson wants the Budget to mount a tax raid on Middle England
REUTERS

Professionals and homeowners in London and the South East could be in the firing line following hints at a squeeze on savings tax relief or the creation of new council tax bands for expensive homes.

Former Cabinet minister John Redwood said that instead of tax rises the Government should be drawing up a list of targeted tax cuts, including stamp duty, to stimulate growth.

He is on the record many, many times as being a low-tax Chancellor 

&#13; <p>Source close to Sajid Javid</p>&#13;

He said: “You cannot tax people into prosperity. You do not make the less well off rich by taxing entrepreneurs to take fewer risks and run fewer businesses.”

Mr Sunak, the new Chancellor, has been asked to appear before the 1922 Committee of Tory backbenchers on March 4 ahead of his debut Budget. He was in discussions with officials today about possibly delaying the Budget until March 18 or 25.

Mr Javid, who resigned as chancellor in Thursday’s reshuffle rather than fire his team of aides, stepped into the debate via Twitter, by liking a comment made by blogger Paul Staines, aka Guido Fawkes, that read: “Needs constant restating, the tax burden is the highest it has been for a generation. Britain is overtaxed.”

A source close to Mr Javid said: “He is on the record many, many times as being a low-tax Chancellor.”

The “tough choices” facing Mr Sunak were spelled out by the Institute for Fiscal Studies, which said tax rises cannot be avoided if spending is allowed to go up.

New Chancellor Rishi Sunak
Getty Images

IFS director Paul Johnson said: “If he keeps [their] manifesto promise to balance current budget he won’t have money for increasing day-to-day spending. We are only just at current budget balance.”

Former Treasury minister David Gauke said the Conservative manifesto specifically committed the Government to fund any current spending from taxes rather than push up borrowing.

Former Treasury minister David Gauke
Getty Images

“It would be very strange to abandon that at this point,” said Mr Gauke, one of the former Conservative MPs who lost the party whip in the Brexit disputes.

He said higher borrowing may be tempting because of low interest rates, but warned: “You do have to be careful that these things can change and in normal times you would not want to see your debt levels rising.”

Mr Gauke said he believed a postponement of the Budget would suggest that decisions taken by Mr Javid were being reconsidered.

Government sources have cooled on a mansion tax idea, leaked to a newspaper last weekend, following a ferocious Tory backlash.

Former Westminster council leader Nickie Aiken, now a London MP, summed up the mood in a tweet saying it would “hammer families and elderly people who’ve worked hard for years to pay their mortgages”.

The executive of the 1922 Committee is understood to have passed the concerns of backbenchers on to the Chief Whip. Sources have not, however, ruled out a raid on pensions or other measures targeting better-off savers.

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