With Truss promising £30bn in direct tax cuts, Sunak has repeatedly highlighted the dangers of unfunded promises and insisted he has already taken steps to cushion the blow of a sharp rise in domestic energy bills expected in October. But as he continues to trail the foreign secretary in the Tory MP polls, and with ballots due within days, he announced a new leaflet, worth £160 to every household – despite previously condemning the policy. “As chancellor I took £400 off everyone’s energy bill and provided £1,200 worth of support for the most vulnerable households. This additional reduction in VAT will help address the current emergency,” Sunak said, arguing that it was a benefit of Brexit that he was able to take the measure. He added: “This temporary and targeted tax cut will give people the support they need, while also – crucially – reducing pressures on prices.” Work and Pensions Secretary Thérèse Coffey, a key figure in Truss’s campaign, hit back, claiming Sunak blocked a similar move earlier this year. “The DWP will soon change the rules to ensure people can continue to look for extra work until they have at least 12 hours a week with the ambition to increase this in the future,” he said. “The DWP had hoped to implement this earlier this year but unfortunately it was blocked by the former Chancellor.” The new pledge came as analysis by the Resolution Foundation thinktank suggested that personal tax cuts such as those promised by Truss were “not a serious response” to the cost of living crisis. “Rising energy bills will bite harder for low- and middle-income households this winter, but only 15% of the cost of scrapping the National Insurance increase would go to the poorest half of the population, while 28% would go to the top 20 “, the thinktank reports. After the pair repeatedly clashed over tax and spending in Monday’s BBC leadership debate, a preliminary poll of Tory members by YouGov showed 50% thought Truss had performed better, compared to 39% for Sunak . In terms of cost of living, 55% thought Truss was better, compared to 34% for Sunak. Rishi Sunak and Liz Truss clash in first TV debate – video highlights As chancellor, Sunak repeatedly resisted pressure to scrap VAT on household fuel bills. Speaking to MPs in February, he said, “I know that some in this House have been in favor of reducing VAT on energy. However, this policy would disproportionately benefit wealthier households.” Later in the same debate, when Conservative MP Kevin Hollinrake called the policy completely wrong, Sunak said he was “absolutely right”. Pat McFadden MP, Labour’s shadow general secretary to the Treasury, said: “Will the real Rishi Sunak please stand up? Once again he’s acting as his own personal rebuttal unit – attacking a policy for months and then adopting it.” Instead of cutting VAT, Sunak opted to offer help to households through a council tax rebate and a £200 reduction in energy bills due to be paid over the next few years. Amid concerns in the cabinet that it had not done enough to respond to the scale of the crisis, he then announced a new support package, including a £400 cut in bills that are now non-refundable, with up to £1200 available for the poorest households . With the energy price cap that sets domestic bills now expected to top £3,000 in October, there was a growing consensus that more action should be taken by the incoming prime minister. In the increasingly acrimonious leadership contest, Sunak has previously sought to cast himself as the guardian of fiscal responsibility, attacking Mr Truss’ £30bn package of unfunded tax cuts as “socialist”, as the pair repeatedly clashed over tax and spending. His team stressed that while the new tax cut would cost £4.3 billion, it would be a one-off measure, starting in October and lasting 12 months, which would therefore have no lasting impact on public finances. Sunak’s latest pledge came as part of what his campaign team called a “Winter Plan” to tackle inflation and the cost of living. Alongside the temporary cut in VAT, it included two other measures apparently only loosely related to the immediate crisis – a tightening of rules on benefits and a commitment to reduce the UK’s dependence on French ports. Subscribe to First Edition, our free daily newsletter – every morning at 7am. BST Sunak said it would double the hours someone on benefits must work before they are no longer required to attend meetings with job coaches at the local job center and continue to look for a full-time job. It is currently nine hours and would increase it to 18. He also said he would “work with Britain’s biggest importers” to encourage them to use Dutch and Danish ports, rather than French ones. It is unclear whether Sunak would offer taxpayer-funded support to help this transition, but it would aim to ease supply chain congestion caused by post-Brexit delays in Dover. Sunak and Truss are due to go head-to-head at a party in Leeds on Thursday – the first of a dozen such events, ahead of the announcement of the result of the leadership contest on September 5.
