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hancellor Rishi Sunak has announced a windfall tax on energy companies and £15billion of extra support for households in a statement in the Commons on the cost of living crisis.
The Chancellor said the government would provide “significant support for the British people”, with inflation rocketing and energy bills set to rise by another £800 in the autumn for millions.
The energy bill discount will be doubled to £400 in the autumn and will be in the form of a grant, rather than a rebate due to the 25 per cent tax on energy firms.
It comes after two Tory MPs called on Boris Johnson to quit as pressure grows on the prime minister following the publication of the damning Sue Gray partygate report.
John Baron, Tory MP for Basildon and Billericay said on Thursday morning he could no longer give the the prime minister “the benefit of the doubt”.
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He said: “The most serious charge against the prime minister is that of knowingly misleading parliament. Given the scale of rule-breaking in No 10, I can not accept that the prime minister was unaware.”
His comments were soon followed by David Simmonds MP for Ruislip, Northwood and Pinner, who called on Mr Johnson to step down “so that new leadership can take forward the important work of the Government in ensuring that our people and country prosper”.
Julian Sturdy, MP for York Outer, became the first to call for the prime minister’s resignation on Wednesday following the release of Ms Gray’s report.
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No10 spokesman apologises for Sue Gray comments
After telling journalists that no parties had taken place in Downing Street, the Prime Minister’s spokesman offered an apology when asked.
He said: “The prime minister has said and I have said on a number of occasions that there were failings, both in terms of what happened and in terms of how it was handled.
“The prime minister has apologised for that, and obviously I’m happy to apologise for that as well.”
Pressed on the matter, the spokesman added: “I’ve apologised for how subsequent events were handled. Beyond that, obviously, I will continue to set out and answer your questions.
“It wouldn’t be appropriate for me to use my position here to set out my own circumstances when others are unable to do so.”
Asked if he had attended any of the events listed by Sue Gray, the spokesman said: “I understand the interest but I’m here to answer questions on behalf of the prime minister. I’m not here to talk about myself as an individual so it wouldn’t be appropriate for me to comment.”
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Eight million to benefit from additional £1,200
Overall, eight million most vulnerable households will receive at least £1,200 of extra support this year, the Government has claimed.
The Government has announced a further £500million for the Household Support Fund, extending it from October until March 2023.
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Energy profit ‘quite generous’ says Institute for Fiscal Studies
Paul Johnson, the director of the Institute for Fiscal Studies (IFS), said the 25% energy profits levy “is an increase in the tax on North Sea profits”.
“It is a reasonable tax system but should be clear how rate will change with profits/oil price,” he said.
Mr Johnson added that the £650 payment to low income households is “well-targeted and quite generous”.
“Especially generous to those on smaller levels of benefits. Less generous to those with high benefits at the moment,” he added.
“Flat-rate payment to those on means-tested benefits probably best way of supporting them.
“But there will be a big cliff edge – those who are only just not eligible, or who are not taking up benefits, will be a lot worse off than those currently receiving small amounts.”
Paul Johnson, the director of the Institute for Fiscal Studies (IFS), said the 25% energy profits levy “is an increase in the tax on North Sea profits”.
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‘This is a discredited and chaotic Government’, says Labour
Continuing, Ms Reeves says: “After today’s announcement let there be no doubt about who is winning the battle of ideas in Britain – it is the Labour Party.
“Today it feels like the chancellor has finally realised the problems that the country is facing. We first called for a windfall tax on oil and gas producers nearly five months ago to help struggling families and pensioners.
“It was Labour that first highlighted the unfairness of this government’s buy now, pay later compulsory loan scheme.
“This is just the mark of this Klarna chancellor – announce now, ditch later.”
Concluding, Ms Reeves said when it comes to the big issues leading the country“we lead and they follow”, while labelling the Government as “chaotic”.
In response, the Chancellor said the levy has a “very generous allowance” and is now the “blunt instrument the Labour party asked for”.
He adds being able to change course on the windfall tax is not a “weakness but a strength”.
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Labour would have solved weaknesses of our economy, says Rachel Reeves
Continuing her speech, Ms Reeves said Labour would have solved the issues of the economy and said the Government has not created a “real plan” to solve the cost of living crisis.
She adds that Labour’s own energy plan will go towards reaching net-zero.
She asks why the Government got rid of the UK’s gas storage capacity.
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Rishi Sunak: Our plan is creating more jobs and seizing the benefits of Brexit
Concluding his speech, he said the Government has a plan to aid millions across the country.
He said the Government is “creating more jobs” and seizing the opportunity of Brexit.
Shadow chancellor Rachel Reeves now responds to the speech, highlighting Labour’s calls for a windfall tax.
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Energy bill rebate doubled to £400
The previously annnounced energy bill rebate, will now be doubled to £400 while households will not have to repay the money.
Overall, the new measures will cost the Government £15billion, the Chancellor said. Combined with the previous measures, the overall cost will be £37billion.
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Chancellor announces one off £300 pensioner payment
Commenting on pensioners, Mr Sunak said many who areelegible for benefits, do not claim the money.
To aid pensioners, he has announced a one off payment of £300 for pensioners.
He has also announced a one off disability payment of £100.
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Chancellor announces £650 for eight million households
He said the levy will raise £5billion in revenue over the next year.
In order to help with the cost of living, Mr Sunak has announced eight million households will get a payment of £650.
The fee will be paid in two sums, first in July and then the second in the autumn.
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Rishi Sunak announces energy profits levy
The Chancellor has announced a new energy profits levy which will have an investment allowance built in.
Energy companies will be issued a temporary 25 per cent tax on profits.
Mr Sunak said: “Like previous governments, including Conservative ones, we will introduce a temporary targeted energy profits levy, but we have built into the new levy… a new investment allowance similar to the super-deduction that means companies will have a new and significant incentive to reinvest their profits.
“The new levy will be charged on profits of oil and gas companies at a rate of 25%.
“It will be temporary and when oil and gas prices return to historically more normal levels the levy will be phased out.”
Within the levy, the Chancellor said “investment allowance” woulkd work to sustain reinvestment in the UK.
https://www.standard.co.uk/news/politics/rishi-sunak-cost-living-energy-bills-windfall-tax-boris-johnson-sue-gray-partygate-report-b1002453.html
