Liz Truss promises to ease tax burden on families as leadership race heads to the wire

Liz Truss speaks to children at Little Miracles in Peterborough

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The Foreign Secretary proposed a major overhaul of tax rules yesterday, to ease the financial burden on parents who take time off to look after children. And people who stay at home to care for older relatives could also benefit.

Speaking in Peterborough, Cambs, on the first full day of campaigning in her tussle with Rishi Sunak to succeed Boris Johnson, Ms Truss said: “I’m going to reverse the increase in National Insurance.

“I didn’t support it in Cabinet in the first place and I think it’s wrong to be putting a burden on hard-working families in what is a very difficult time.”

She added: “We will review the taxation of families to ensure people aren’t penalised for taking time out to care for their children or elderly relatives.”

Ms Truss also vowed a “temporary moratorium” on the green levy, which would save people money on their energy bills.

Asked whether she would also cut fuel duty, she said: “I’m not going to write the whole first Budget now…but what I can say is that we need to reduce the tax burden. It’s the highest level it’s been for 70 years.

“If we have rises in corporation tax as is currently being planned, that will put off people investing in Britain and that will make it harder to attract the businesses we need to drive the economy.”

Ms Truss insisted her £30billion tax cuts plan was “affordable”. And, in a swipe at Mr Sunak, she said: “What is not affordable is putting up taxes, choking off growth and ending up in a much worse position.”

She said world bodies including the Organisation for Economic Co-operation and Development had warned recent tax rises could lead to the economy shrinking and trigger a recession and “we simply cannot afford that.”

She also pledged to “bulldoze” “endless government bureaucracy” and vowed not to “take no for an answer.”

Asked how she would confront the Treasury, she said: “What I would do – and I’ve done this as Foreign Secretary, I’ve done this as Trade Secretary – is, I’ve bulldozed through the blockages.

“I get stuff done, whether it’s the Northern Ireland Protocol Bill, whether it’s the dozens of trade deals, whether it’s the sanctions regime on Russia…because I don’t take no for an answer and I go in and I fight for what is right. I hear what people say.”

Pitching herself as Labour’s worst nightmare “because I’m not from a traditional Conservative background”, Ms Truss, who visited Peterborough children’s charity Little Miracles, said: “I was brought up in Paisley and Leeds, I went to a comprehensive school. I know how Labour failed kids.”

Despite pledging vast tax cuts, Ms Truss insisted she was not planning “public spending reductions”. She plans an immediate review to look at treating households as single entities and allowing household members to transfer income tax allowances.

Ms Truss’ aides say tax systems to ease the burden on carers who take time off from work already exist in Germany and the US. A source close to her said: “Liz believes supporting families and carers is crucial to Britain’s future success and would prioritise it as Prime Minister. She wants to do that through reform of the tax system.”

Ms Truss also said even though Mr Johnson made “a mistake, or several mistakes, over the course of the last year”, she had wanted him to continue as Prime Minister.

She said: “I think he did a fantastic job with the 2019 election, winning us a massive majority. He delivered Brexit, he delivered the vaccines. Regrettably, we got to a position where he didn’t command the support of our parliamentary party.”

Asked if she was the continuity Johnson candidate, she said: “What I am not is the continuity economic policy candidate, because I think that is where we didn’t get it right.”

Meanwhile, the latest YouGov poll of Tory Party members made Ms Truss strong favourite to defeat Mr Sunak by 62 per cent to 38 per cent.

Yesterday, she expressed irritation at suggestions she had modelled her image on Tory premier Margaret Thatcher. She said: “It is quite frustrating that female politicians always get compared to Margaret Thatcher, whereas male politicians don’t get compared to Ted Heath.”

Ms Truss said she would serve under Mr Sunak if he defeated her. And, in a reference to Mr Johnson’s controversial refurbishment of his Downing Street flat, she quipped that as PM, she would have no time to think about changing the wallpaper.

She said: “We’ve only got two years until the general election – we need to hit the ground running.”

Former Tory leader Sir Iain Duncan Smith said: “Liz was the one that was standout in terms of the last two-and-a-half years – whether it was trade deals, whether it was opening the door to Australia, also to the Trans-Pacific Partnership.

“Or back here standing up to [Vladimir] Putin and also sorting out the Northern Ireland problem. These are all things she’s taken on, refusing to accept that there was even a problem and getting them done.”

He said of Mr Sunak’s handling of the economy during Covid: “There we were, chucking money out of the Treasury, and some of it was spent rather badly, actually.”

Sir Iain added Mr Sunak’s higher taxes, combined with high interest rates, would “crush the economy.”

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