Jacob Rees-Mogg ‘is leading tax revolt over cost of living’ as he calls for 1.25% NI rise to pay for social care reform to be shelved
- Jacob Rees-Mogg is leading growing Tory tax revolt over the cost-of-living crisis
- Reported he suggested shelving the 1.25% national insurance rise for social care
- Chancellor Rishi Sunak pushed back calls for levy to be scrapped or postponed
- Comes as business leaders warned spiralling energy prices could lead to higher shopping bills and 2% inflation rise
Jacob Rees-Mogg is leading a growing Tory tax revolt over the cost-of-living crisis, it was claimed last night.
The Commons leader told Boris Johnson that a planned tax hike in April cannot be justified while families face soaring costs for food and heating.
In a heated Cabinet meeting yesterday, Mr Rees-Mogg reportedly suggested the 1.25 per cent national insurance rise to pay for social care reforms should be shelved.
But Chancellor Rishi Sunak pushed back against calls for the levy to be scrapped or postponed, the Financial Times said.
There is a a growing Tory tax revolt against planned tax rises while families face soaring costs for food and heating, it was claimed last night
It came as business leaders warned that spiralling energy prices could lead to higher shopping bills and add a further two per cent to rising inflation
A Government insider told the newspaper Mr Rees-Mogg felt ‘finding savings would be more frugal and responsible’ than raising taxes to fund improvements to the NHS.
And his colleagues said he was ‘increasingly unhappy’ at the Government’s policy direction, including on Covid curbs.
But Mr Rees-Mogg’s allies insisted he was ‘a loyal supporter’ of the PM, and declined to comment on his intervention in Cabinet.
It came as business leaders warned that spiralling energy prices could lead to higher shopping bills and add a further two per cent to rising inflation.
It was claimed last night that Commons leader Jacob Rees-Mogg told Boris Johnson that a planned tax hike in April cannot be justified while families face soaring costs for food and heating
A British Chambers of Commerce survey of almost 5,500 companies found three out of five expect their prices to increase in the next three months as they pass on extra energy costs.
Families are also being warned that domestic gas and electricity bills could rise by as much as 50 per cent in April as the energy price cap is hiked.
£5m a day fuel ‘rip-off’
Motorists were ripped off by £5million a day last month by filling stations cashing in on lower wholesale oil prices.
Analysis by the RAC found that average pump prices for unleaded fell by just 2p a litre, but could have gone down by 12p if the full drop in wholesale prices had been passed on.
And a 2p fall in diesel prices could have been 8p. The difference made the cost of filling a typical family car £6 more expensive than it should have been for petrol and £4 for diesel, said the RAC. Spokesman Simon Williams called the profits ‘nothing short of scandalous’.
The Petrol Retailers Association said profit margins have remained higher so stations can recoup losses made in the pandemic.
Mr Johnson last night rejected demands to suspend green levies on household bills to ease pressure on consumers.
At a meeting with Business Secretary Kwasi Kwarteng yesterday, energy company chief executives called for the levies to be removed from bills along with VAT.
They also asked the Government to provide loans so they can in turn help customers and for an increase to the £140-a-year warm homes discount available to the poorest households.
Asked if any of the ideas would be implemented imminently, the Prime Minister’s spokesman said: ‘I’m not aware of any further changes at the moment, but obviously we keep it under review and are listening to those that are most affected.’
On the question of whether green levies will be kept on bills, he replied: ‘There’s no plans to change that approach.’
This week the Prime Minister also appeared to rule out cutting VAT on fuel, saying it wouldn’t benefit those most in need.
The energy industry body warned the expected rise in April of the domestic energy price cap could lead to a further two per cent rise in the cost of living.
Figures published last month showed inflation was already running at 5.1 per cent in the 12 months to November, its highest rate in ten years.
Energy UK chief executive Emma Pinchbeck told Radio 4’s Today programme: ‘This is a wholesale price risk, which is a whole-economy risk, it doesn’t just apply to the energy retailers.
‘It’s quite likely that the Treasury themselves will have to take a view on what to do because this impacts not just the energy retailers, but the whole economy. Energy costs going up like this could be a one per cent to two per cent inflationary increase.’
The British Chambers of Commerce said firms are suffering a ‘huge headache’ due to continuing supply chain disruption, inflation and rising energy costs.
- Fears are growing that another energy supplier could join the 25 which have gone bust since August. Together Energy is seeking an injection of funds amid predictions it could run out of money later this month.
Food bills up £15 a month
Food bills are rising by £15 a month due to big increases in the cost of fresh meat such as beef and lamb.
Inflation on household essentials of 3.5 per cent is adding the average amount compared with a year ago, according to research.
The figure is the highest in almost four years, except for a blip in 2020 linked to the impact of the pandemic.
An employee stacks vegetable shelves at a Waitrose supermarket in London
Retail analysts Kantar, who sourced the data, said the cost of fresh beef was up by some 12.2 per cent on a year ago with fresh lamb up 9.5 per cent.
The figures, which cover the four weeks to Christmas, also show a rise of 11.4 per cent on savoury snacks and 9.4 per cent on crisps. Grocery sales in December were at £11.7billion.
Fraser McKevitt, of Kantar, said ‘people seized the chance to enjoy Christmas after [2020’s] muted festivities’.
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