The pound continues to weaken against the euro following yesterday’s inflation data. Inflation is now more than 5 times higher than the BoE’s target. Against the dollar, sterling has also weakened.
Tory leadership candidate Liz Truss has pledged to scrap April’s National Insurance in efforts to help households. Truss has also sworn to scrap a planned rise in corporation tax, as high taxes are “choking off growth” in Britain’s economy.
Rival candidate Sunak has also vowed to lower VAT on domestic energy bills from 5% to 0. He has also pledged a reduction on income tax by 3p (which should happen by late 2029). However, Sunak emphasized these tax cuts will only happen once Britain has “gripped inflation”.
The Institute for Fiscal Studies (IFS) said it was concerned by both candidates’ tax cut plans, due to the economy’s “deteriorating outlook”.
