Rishi Sunak will consider tax cuts – but only under one condition

Rishi Sunak will consider tax cuts if the Government can meet its target of halving inflation, a close ally revealed.

The Prime Minister is facing growing calls to ease the burden on hard-pressed families after two crushing by-election defeats last week.

Tory MPs want to be able to sell tax cuts to the public ahead of the next General Election to prevent Keir Starmer securing the keys to Downing Street.

Immigration minister Robert Jenrick, a close political ally of Mr Sunak, said: “We all want to cut taxes. Everyone wants lower taxes, as a Conservative it is one of the central tenets of conservatism that we believe in lower taxes.

“But the first task has got to be bearing down on inflation because it’s ultimately inflation today and in the last couple of years since the pandemic which has been the great evil which has been eroding people’s savings and leading to mortgages rising.”

He added: “If we can get that under control” then “of course we will consider what more we should do” on taxes.

The Immigration minister insisted: “You can trust the Conservatives to make sensible, prudent decisions on the future of the economy and to bring down taxes where it is capable to do so.

“Look at the difference that we’ve seen in the last 12 months under Rishi Sunak, the fact that we have stabilised the economy, that it’s growing, that inflation is falling and on critical issues like immigration, were making significant progress for the first time in a long time.”

Labour overcame a Tory majority of 24,4664 in Mid Bedfordshire to win the seat for the first time and in Tamworth there was a 23.9 per cent swing to Labour from the Tories.

One former minister said after the bruising defeats: “When we’ve got such a high tax burden people will just wonder what’s the point of voting Conservative.”

The Bank of England governor, Andrew Bailey, said he expected a “noticeable drop” in inflation when October’s figures are published next month.

Mr Bailey said he expects inflation to “keep coming down”, with a “marked fall” expected next month.

He said: “The reason for that is really arithmetic actually, this time last year energy prices went up a lot, gas prices went up a lot. Because we will remember, we were very concerned that we were going to run out of gas over the winter.

“Because inflation is an annual calculation, that will come out of the calculation next month. So we do expect quite a noticeable drop next month.”

However, he warned that inflation would only fall “incrementally” after that.

Tory MP John Redwood said: “We need tax cuts now to speed up the fall in inflation. Cut fuel and home energy taxes to offset the rise in oil and gas prices. Cut taxes on self employment and small businesses to expand supply and reduce price pressures.”

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