A DORSET MP has criticized the chancellor for announcing a new tax on his emergency measures to counter the rising cost of living.
South Dorset MP Richard Drax today criticized the government for opposing an extraordinary tax on oil and gas companies, and announced that it would introduce a tax to deal with rising bills.
Chancellor Rishi Sunak announced today that millions of households will receive a £ 400 discount on their energy bills and that a £ 5 billion tax will be levied on the oil and gas giants.
The idea of an unexpected tax had met with resistance from the government, with Mr. Sunak among ministers to warn about the impact it would have on future investment.
But the chancellor said his plan for a 25% tax on energy profits would be combined with a new incentive, almost doubling the tax relief available on investment.
Sunak did not stop paying the new tax on electricity generators as well, although he said the Treasury was assessing the scale of the profits to be made in the industry and what steps could be taken.
Consumer price index inflation rose to 9% in April and consumers are poised for the energy price cap to rise from more than £ 800 to £ 2,800 in October as the pressure on the standard of living continues.
The chancellor told lawmakers: “The high inflation we are experiencing is now causing great distress to the people of this country.”
Conservative MP Richard Drax told the Commons: “I can warn you (Rishi Sunak) that throwing red meat at socialists by raising taxes on companies and telling them where to invest their money is not the conservative way to encourage they create our prosperity and jobs to do just that.
“And it agrees with me that by setting this bar, we run the risk – if we ever lose power – of allowing the Socialists to lift it, which they would gladly do, over and over and over again.”
The chancellor replied: “I believe that a pragmatic and compassionate Conservative government would act to support the most vulnerable in a time of acute need, and a fiscally responsible government would try to fund it as fairly as possible. possible “.
Sunak was forced to introduce emergency measures as part of a £ 15bn package to deal with the impact of rising inflation, which has reached its 40-year high.
In addition to universal payment, there was specific support for the poorest, the elderly, and the disabled.
The chancellor acknowledged that high inflation is causing “acute distress” for the country’s people, and told lawmakers, “I know they are worried, I know people are struggling.”
He said the government “will not stand idly by as long as there is a risk that some of our country will fall so far behind that they will never recover.”
The £ 400bn announcement of £ 400m in universal support from October replaces the initial plan of a £ 200 loan, with Sunak ruling out the requirement to return the money.
Other measures announced by the chancellor include: a single payment of £ 650 to more than eight million low-income households, paid in two installments in July and autumn at a cost of £ 5.4 billion; a £ 300 payment to boarding houses in November / December along with the payment of winter fuel, at a cost of £ 2.5 billion; and £ 150 to people receiving disability benefits, for a total of £ 0.9 billion, paid in September.
The plans will be funded with about £ 10bn in additional loans, but Sunak insisted it had a “responsible fiscal policy”.
The package would mean that almost all of the eight million most vulnerable households will receive at least £ 1,200 in support, including a £ 150 municipal tax rebate that has already been announced.
An additional £ 500 million will be allocated to the fund administered by the town councils to help households facing additional difficulties.
The chancellor stressed the need to keep public finances under control and described as a tax on oil and gas companies, which have benefited from high world prices driven by post-pandemic and war demand in Ukraine. it would raise about £ 5bn to help cover the cost.