RISHI Sunak is reportedly plotting a tax raid on online deliveries and the self-employed to help pay for the spiralling £300bn Covid bill.
He will use Wednesday’s budget to unveil consultations on further tax hikes to pay for the mounting cost of the crippling pandemic, claims a new report.
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The Sunday Telegraph says this will include options to further hit online retail – and could even include the possibility of a new “green tax” on every delivery.
However the report claims it is now understood he is not looking at a suggested windfall tax on the “excess profits” of internet giants.
The Chancellor is also said to be planning to use an autumn Budget to increase the National Insurance contributions of the self employed.
It is reported he is arguing they have also benefited from government support during the coronavirus pandemic.
One Treasury source told the Sunday Telegraph: “The idea of an online sales tax is being looked at as part of the business rates review.
“Responses to the consultation are being considered in the round, but the Chancellor is cognisant of the need to level up the playing field between the high street and online taxation.”
Meanwhile, the Sunday Times reports the Chancellor is to set out plans to raise income tax by £6bn to plug a huge hole in the nation’s finances.
He will apparently announce he is freezing the point at which workers start paying the basic rate of income tax – £12,500 – and the £50,000 threshold at which they begin to pay the higher 40p rate.
That would mean 1.6 million people are pushed into a higher tax bracket over the next three years.
Earlier Mr Sunak said Britain’s public finances faced “enormous strains” in the wake of the third national lockdown.
He said he wanted to “level with people” about the bill for the Government’s Covid support bill which he said will eventually have to be paid.
Low-interest rates, which have allowed the Government to borrow to pay for the Covid support costs, have left the nation’s finances “exposed”, Mr Sunak.
He told the Financial Times: “We now have far more debt than we used to and because interest rates… at least a month or two ago were exceptionally low, that means we remain exposed to changes in those rates.
“That’s why I talk about levelling with people about the public finances and our plans to address them.
“I stood up at the beginning of this [coronavirus] thing and said I will do whatever it takes to protect the British people through this crisis and I remain committed to that.
“We went big, we went early, but there is more to come and there will be more to come in the Budget.
“But there is a challenge [in the public finances] and I want to level with people about the challenge.”
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The budget is expected to include numerous measures to kick-start the nation’s economy as lockdown eases over the coming months thanks to the vacation rollout success.
The Chancellor will reportedly say in the Budget that “we have to be honest about the decisions we face as a country”, and that such decisions must be “underpinned by fairness”.
One option believed to be under consideration is a “stealth tax” on affluent pensioners, which will see the lifetime allowance frozen for the rest of this Parliament, The Times reported.