UK Budget: Chancellor Jeremy Hunt must put national interest ahead of the Conservative party's – Scotsman comment

Jeremy Hunt in under considerable pressure for tax cuts that some Tory MPs believe will help turn around their fortunes in this election year

With high government debt, a stagnating economy, a housing crisis and inflation still too high, Jeremy Hunt is in a difficult position. Not only that, the Chancellor is under pressure from Conservative MPs to deliver a feelgood, tax-cutting Budget that they hope will spark an unlikely turnaround in their fortunes ahead of the general election. He should also feel the pressure from the need to increase defence spending to counter the very real threat posed by Vladimir Putin and shore up crumbling public services – the NHS chief among them.

Were this not an election year, the usually pragmatic Hunt would probably make a reasonable job of navigating between these competing demands. The risk is that he is persuaded by self-interested or overly ideological members of his party to throw caution to the wind. One question he should ask himself is whether significant tax cuts would actually have any positive effect on their fortunes.

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Many Conservatives have already resigned themselves to election defeat and excessive tax cuts might backfire if they are seen by voters as an attempted bribe by a government that has failed to prevent the country from slumping into its current parlous state, admittedly amid considerable global turbulence. An overly generous budget could also fuel inflation and reduce the chance of a cut in interest rates, which may influence the way many people cast their vote.

That's not to say there should be no cuts at all, particularly where it makes sense to do so. According to a Scottish Whisky Association analysis, increased duty on spirits has actually reduced revenue to the Exchequer because of falling sales and a cut would result in an increase. If this is correct, then it makes financial sense for Hunt to become only the fourth Chancellor in a century to cut duty on Scotch. The same could be true of other elements of taxation, particularly given how high levels currently are.

We urge Hunt to put the national interest above his party's, which would seem to be his instinct, and make decisions that will help rather than hinder the next government.



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