Rishi Sunak grilled by Drax on business tax increases
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Chancellor of the Exchequer Rishi Sunak’s costo of living package to support the lowest-income households facing skyrocketing energy prices has come under fire from his own ranks. Mr Sunak announced a “temporary targeted energy profits levy” on profits of oil and gas companies at a rate of 25 percent until “oil and gas prices return to historically more normal levels.” In a dramatic u-turn to the Government’s previous stance, Chancellor Sunak said the £15billion package will provide a one-off £400 aid to every household, £650 to families on benefits and £300 to pensioners.
Speaking in the House of Commons, Tory MP Richard Drax lashed out: “Can I warn my right honourable friend that by throwing red meat to socialists, by raising taxes on businesses and telling them where to invest their money is not the conservative way of encouraging those who create prosperity and jobs to do just that.
“And does he agree with me that by setting this bar, we are in danger of aligning with socialists to raise it, which they would do with relish again and again and again?”
Mr Sunak hit back: “Madame Deputy Speaker, I thank my honourable friend.
“And what I’d say to him is I do believe a pragmatic and compassionate conservative government would act to provide support to the most vulnerable in a time of acute need.”
“And a fiscally responsible conservative government would look to try to fund as much of that as possible and in the fairest way as possible”, Mr Sunak added.
The package come after months of pressure on Boris Johnson’s Government to act on the skyrocketing energy prices that are taking a dramatic toll on struggling households.
The energy regulator Ofgem’s chief Jonathan Brearley warned MPs earlier this week that the energy price cap would rise to about £2,800 in October from £1,971 in April.
Ofgem previously increased it from £693, meaning the energy price cap has more than quadrupled since early this year.
Shadow Chancellor Rachel Reeves also came at Boris Johnson for not acting sooner.
“You can’t fake fairness”, MP Reeves erupted.
“You either fake it, or you don’t. Labour called for a windfall tax because it is the right thing to do.
“The Conservatives are doing it because they needed a new headline”, MP Reeves added.
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Ofgem chief Bearley warned MPs the skyrocketing prices seen on the energy market are “genuinely a once-in-a-generation event not seen since the oil crisis of the 1970s.”
The Resolution Foundation also sounded alarm bells, pointing out the energy price cap rise would tilt 9.6 million households into “fuel stress” this winter.
The director of the Institute for Fiscal Studies says Rishi Sunak’s aid support package is “hugely redistributive” adding the new measures were the “right thing to do.”
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