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Boris Johnson and Rishi Sunak announce £6billion cost of living tax cut

Boris Johnson and Rishi Sunak leave 10 Downing Street

Boris Johnson and Rishi Sunak leave 10 Downing Street (Image: PA)

Boris Johnson and Rishi Sunak have told Brits the government is “on your side” when it comes to the deepening cost-of-living crisis.

But with food and gas prices soaring to new highs and leaving millions in financial distress, some might find their reassurances hard to digest.

In an op-ed for the Sun on Sunday, the Prime Minister and Chancellor outlined what they describe as “the biggest single tax cut in a decade” worth £6billion.

Their measures include “a council tax refund, a fuel tax cut, at least £400 for each household to help with energy bills and at least £1,200 for the eight million most vulnerable households”.

Mr Johnson and Mr Sunak said if the National Insurance (NI) threshold rises from £9,880 to £12,570 this Wednesday, 30 million people will save up to £330 a year.

They claim the change will exempt 2.2 million people from paying NI, or income taxes, on their earnings.

Boris Johnson and Rishi Sunak celebrate

The Prime Minister has previously said his government is not “happy” with rising inflation (Image: PA).

“We know it’s tough, but we want you to know that this government is on your side,” they wrote. “And while it’s going to be tough, we’re going to get through this.

“That’s why we’re helping households across the country with £37 billion in financial support.”

They added, “So whether you work in a factory or you’re a caregiver, hairdresser or graphic designer, this week’s tax cut will likely make you and your family better off.”

Mr Johnson and Mr Sunak blamed the cost of living crisis with the extra demand caused by global industry reviving after Covid and the war in Ukraine.

This comes after the Tory leader denied his government was “satisfied” with rising inflation and said the “cost of liberty” was “always worth paying”.

At a press conference on Thursday at the conclusion of the NATO summit in Madrid, he said the “very, very tight labor market” and the difficult “balancing of our energy mix” would increase inflationary pressures.

There has not yet been a Labor response to the two politicians’ claims in the Sun, but the opposition has previously criticized Mr Sunak’s response to the cost of living.

As part of his mini-budget, he announced a 1.25% (in percentage points) NI increase, which came into effect on 6 April, in theory to help fund the stretched NHS.

But rates are set to fall next week as the repayment threshold rises and some welcome savings will be made for those on lower incomes.

People can find out exactly what this ‘tax break’ will mean for them by visiting the government’s cost of living page on gov.uk and using the calculator available.

Get in touch with our news team by emailing us at webnews@metro.co.uk.

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https://metro.co.uk/2022/07/03/boris-johnson-and-rishi-sunak-announce-6bn-cost-of-living-tax-cut-16932495/ Boris Johnson and Rishi Sunak announce £6billion cost of living tax cut

Justin Scacco

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