Truss’s tax and spend plans could cost £50bn a year

Liz Truss claims her promised tax cuts and defence spending would cost £30bn but economists say the bill could go as high as £50bn. The foreign secretary has pledged to cancel the national insurance rise and scrap a planned increase in corporation tax, along with removing green levies and increasing the married tax allowance. The Resolution Foundation thinktank said the tax cuts had a big price tag and were “not a serious answer for the current crisis”. It said scrapping the corporation tax rise could cost £19bn, while Treasury figures suggest reversing the national insurance rise would cost around £13bn. The defence spending pledge could cost an extra £10bn a year by 2025-6, while the married tax allowance increase could cost £6.7bn. Taking green levies off bills could cost as much as £11bn. Stuart Adam, senior research economist at the IFS, said Truss’s tax cuts “basically don’t do much for those at the bottom of the distribution who are struggling most to cope.”

The Guardian

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