Priti Patel blasts Sunak: 'UNFREEZE tax thresholds - Fiscal drag is a tax increase!'

Priti Patel blasts Sunak: 'UNFREEZE tax thresholds - Fiscal drag is a tax increase!'
GBN Videos

By GBN Videos

Published: 23/11/2023

- 10:58

Updated: 23/11/2023

- 10:59

Dame Priti Patel has said she believes today’s Autumn Statement was the Chancellor nudging the door open on further right leaning policies.

Speaking to Patrick Christys on GB News: she said: “My reaction was quite mixed to be perfectly honest. First and foremost I’m a low-tax Conservative; I actually believe in targeted tax interventions, so tax cuts which are specifically targeted to businesses, but also individuals.

“So there were certain things that I would have liked to have seen happen that didn’t happen.

“But if you look at the politics of today, and that’s quite important, I think the Chancellor has nudged the door open a little bit – kind of like showing a little bit of leg, in terms of that true Conservative narrative.

“We’re low tax, we want to give people more of their money. The measures he announced - they don’t go far enough - but the cut to national insurance, that’s important and it is significant because he said he’s going to bring it forward to January next year. And of course, the public will start to feel the benefits of that by the Spring next year.

“You can read into all of that in whichever way you would like to, potentially in terms of the electoral politics as well for the government.

“I’m a great believer in unfreezing those tax thresholds. There are many people on low incomes who get caught in that tax threshold that has been frozen – the personal tax allowance.

“And also the higher rate, so for example, many of our public sector workers; our police officers, nurses and teachers, they now get caught in that fiscal drag which basically means more of their income gets hoovered up by the Exchequer.

“The evidence is very clear – the OBR have published it all now anyway – this year alone the Treasury will rake in something like £12 billion through fiscal drag, so that’s more people paying the higher rates of taxation.

“And you could argue it’s actually a tax increase without it being a direct tax increase without it being a direct tax increase in terms of the headline rate of tax.

“By 2028, in a few year’s time, so many more people will be caught into that. Four million more lower income workers will be, three million more will be paying the higher rate and on top of that the OBR have forecast that the government will rake in £45 billion of extra revenue just through fiscal drag.

“I think that’s one area where changes should have been made, could still be made next year – don’t rule that out – in the Spring budget, and would actually make a big difference to people having more money in their pockets.

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