Rishi Sunak to put tax cuts at centre of Tory election manifesto

Rishi Sunak will on Tuesday put tax cuts at the heart of the Conservative party manifesto, as he attempts to reset an accident-prone election campaign and make inroads into a daunting 20-point Labour poll lead.

The prime minister is expected to promise further cuts to national insurance in the manifesto, according to Tory officials, as well as confirm extra help to get people on the housing ladder.

Conservative policies will also include a crackdown on welfare, a boost in defence spending to 2.5 per cent of GDP, a revival of national service and a commitment to press ahead with a contentious Rwanda asylum scheme.

Sunak will guarantee that a Tory government would not raise income tax, national insurance or value added tax, and would introduce a “triple lock plus” to prevent those on the basic state pension having to pay income tax.

“We are the party of Margaret Thatcher and Nigel Lawson, a party, unlike Labour, that believes in sound money,” Sunak will say at the manifesto launch.

“In this party, we believe that it is morally right that those who can work do work, and that hard work is rewarded with people being able to keep more of their own money. We will ensure that we have lower welfare so we can lower taxes.” 

The Conservative manifesto launch is one of the last big set-piece occasions for Sunak to change the terms of the election campaign, after his much-criticised decision to return early from D-Day commemorations in France.

With the row persisting over his decision to skip an event on Omaha Beach in favour of a television interview that he used to attack Labour on tax, Sunak pleaded with voters to accept his apology made last Friday.

“The last thing that I wanted to do was cause anyone any hurt or offence or upset, which is why I apologised unreservedly for the mistake that I made,” he told the BBC’s Panorama.

“I can only ask that I hope people can find it within their hearts to forgive me and also look at my actions as prime minister,” he said, citing government policies to help veterans and boost defence spending.

New polling by YouGov found 45 per cent of Britons thought the Tories were running the worst election campaign, up 11 points on last week. Some 10 per cent thought Labour was running the worst campaign.

Sunak hopes to get back on the front foot on Tuesday, partly through his promise to carry on cutting national insurance.

Senior Tories said the plan was to further reduce the rate of employee contributions from 8p to 6p, allowing the party to say it has halved the tax over the course of a year, from 12p.

Sunak has also been consulting ministers over the use of tougher language regarding the European Court of Human Rights in relation to his controversial plan to send some asylum seekers to Rwanda.

Sunak has said he would not let a “foreign court” block deportations of asylum seekers to the central African nation, but many moderate Tories have warned him not to explicitly commit to pulling out of the ECHR.

During the BBC interview, Sunak was repeatedly challenged to explain why voters should believe his promises when taxes in the last parliament had risen, hospital waiting lists had soared and net annual migration had only recently started falling from highs of more than 700,000.

Sunak admitted it had become more difficult for people to buy their own home under his government. “It has got harder, and I want to make sure that it’s easier,” he said.

Sunak is expected to promise to end stamp duty permanently for first-time buyers for homes costing up to £425,000, in an attempt to address the problem.

Tory officials said there would also be a £1bn scheme to provide government-backed mortgages to help first-time buyers purchase a home with a 5 per cent deposit.

“What we will do is not just build homes in the right places and do that in a way that is sensitive to local communities, but make sure that we support young people into great jobs so they can save for that deposit,” said Sunak.

Angela Rayner, Labour deputy leader and shadow housing minister, said: “Rishi Sunak’s confession that having a home of your own has got harder under the Tories is a damning indictment of 14 years of housing failure. Home ownership is a pipe dream for young people in Britain today.”