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Everyone in the UK will pay more tax as a result of Thursday’s Autumn Statement, Chancellor Jeremy Hunt said. Mr Hunt also confirmed that government support for energy bills will target the most vulnerable after April, in a move expected to cost millions of households hundreds of pounds. Speaking days before the crucial mini-budget, Mr Hunt confirmed he expected the UK to plunge into recession and said his aim was to make it “as short and shallow as possible” by reducing inflation. The chancellor confirmed his statement would include both tax rises and spending cuts to deal with the blow to UK finances caused by the extra energy costs, which he said was equivalent to funding a second NHS every year. And he said it would also include “a long-term plan for clean energy, green energy and cheap energy” to ensure Britain is never again at the mercy of international events such as Russia’s war in Ukraine. Speaking on Sky News Sunday with Sophie Ridge, Hunt said: “We’re all going to pay a bit more tax.” But he pledged to ensure the most vulnerable are protected. “We will ask everyone to make sacrifices,” he told Sky News. “But in a fair society – like we are in the UK – there’s only so much you can ask of people on the lowest incomes.” He said his statement would show “compassion and support for the most vulnerable people”. Economist Paul Johnson, director of the Institute for Fiscal Studies, said Mr Hunt’s comments could mean “some significant additional taxes”, which could include restoring the 1.25 per cent rise in national insurance he had announced by Rishi Sunak earlier this year, but canceled by Liz Truss. But as many people do not pay income tax or national insurance, the only way for the chancellor to ensure everyone pays more tax would be to increase VAT, Mr Johnson said. Mr Hunt signaled that the Government’s energy support plan – with all households’ gas and electricity bills held at an annual average of £2,500 for the six months to April at a cost of £60bn – would be reduced once the winter. The statement will set out plans for “short-term support for the people who need it, but also a long-term plan to really change our approach to energy,” he said. And he told BBC1’s Sunday with Laura Kuenssberg that he would impose “restrictions” on the support, which is currently available to all households. “Will it be unlimited, unlimited?” he said. “We have to recognize that one of the reasons for the volatility that followed the mini-budget was that people were worried that we were exposing the British public finances to the volatility of the international gas market. “So there has to be some limitations on that. “But, yes, we will continue to support families and I will explain exactly how we will do that.” Documents submitted to the Office for Budget Responsibility show that Mr Hunt intends to extend the program for another six months at a significantly reduced cost of £20bn, according to The Sunday Times. This could see the guarantee increase by up to £3,100, costing the average household an extra £600. Jeremy Hunt says everyone will “pay more tax” ahead of the Budget statement Hunt insisted that Britain would overcome the difficult period ahead, telling Sky: “There will be very difficult decisions, but we are a resilient country and we have faced far greater challenges in our history.” The chancellor is understood to be considering a package of £25bn worth of tax rises and £35bn of public spending cuts to plug a gap of up to £60bn in the government’s finances. He has pointed out that this will mean tight arrangements for vulnerable Whitehall departments, and today said the NHS would also have to find “effectives”. While he acknowledged that NHS doctors and nurses are under “unbearable pressure”, he added: “There is a lot of money going into the NHS and … in the context of NHS funding increasing, we have to do everything we can to find efficiencies ». Mr Hunt told Kuenssberg: “Our schools, hospitals, all our public services have to face the cost of inflation. What they (will see) is a government that has a plan to address the root cause of these pressures… which is the bills going up, the electricity bill going up, the gas bill going up. “What we need to do is a combination of short-term support for people who are struggling – and absolutely schools and public services are in that category – but also a plan that says ‘This is how we’re going to get through this.’ “ The chancellor is also expected to extend the four-year freeze on income tax caps by two years, pushing millions more workers into higher rates. Similar freezes will increase bills for national insurance and inheritance tax. And reports suggest he may cut the threshold for the top 45p from £150,000 to £125,000 and halve the tax-free allowance for capital gains tax in order to target some of the pain at the wealthiest Britons. The chancellor is expected to extend the windfall tax on North Sea oil and gas companies by two years until 2028. He told Kuenssberg that failure to take steps to balance the books would mean a sharp rise in mortgages. “If we do nothing, the Bank of England will raise interest rates,” Hunt said. “They have to do this constitutionally. It is their job to reduce inflation. “If we don’t help them with what we’re doing as a government, they’re going to have to take that pressure and we’re going to see mortgage rates go up, interest rates go up and that’s going to be detrimental to families up and down the country. “A dynamic economy needs low taxes and sound money. But sound money must come first, because inflation eats away at the pound in your pocket and the pound in your bank account as insidiously as taxes.” In a sign of the resistance Hunt will face from within his own party if he chooses to raise taxes, former Chancellor of the Exchequer Simon Clarke said spending cuts would have to carry most of the burden of the £60bn austerity. Mr Clarke, a close ally of Liz Truss during her brief tenure as prime minister, told Sky: “I would urge Jeremy to make sure we do as much as possible of spending cuts as opposed to tax rises, noting that the tax is very high. high level and facing the risk of recession”. But Labour’s shadow chancellor Rachel Reeves warned against “Austrity 2.0”, saying public services were already “on their knees”. He told Sky: “Seven million people are waiting for an operation or NHS support. If you look at our schools, our class sizes are growing. Teachers are increasingly forced to finance the basics with their own money. “So I don’t think austerity 2.0 after the austerity we’ve been through for the last 12 years is the right approach, so I’m advocating two things, both fairer options in terms of taxes, but also, crucially, a growth plan” . Ms Reeves acknowledged that Labor would be limited in its economic plans if it came to power, blaming the “mess” she would inherit from the Conservatives. He told Kuenssberg: “I recognize that a new Labor government will not be able to do what we want as soon as possible. “This is disappointing because the way the government has managed our economy and public finances over the last decade means that we have both brought public services and public finances to their knees in chaos.”
