Liz Truss and Rishi Sunak were grilled on their economic plans this week, just hours after the Bank of England warned that the UK will fall into a prolonged recession.

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After the Bank said inflation will surge above 13%, causing the worst squeeze on living standards for more than 60 years, the two Conservative leadership hopefuls faced questions from party members during a Sky News debate.

Sunak said he would “prioritise gripping inflation, growing the economy and then cutting taxes”, while Truss said there was a need “for the bold economic plan that I am advocating”.

What is Truss’ plan?

The foreign secretary said her proposed tax cuts could avert the looming recession. “What the Bank of England has said today is, of course, extremely worrying. But it is not inevitable,” she said. “We can change the outcome, and we can make it more likely that the economy grows.”

Truss blamed the government’s decision to raise the tax burden to the highest level since the 1950s for pushing the economy towards a recession. She plans £30bn worth of tax cuts and said she would start to implement them “from day one”.

She has promised to reverse Sunak’s plans to increase corporation tax from 19% to 25%, while also scrapping green levies on energy bills and a national insurance rise, saying these steps would help avert the downturn and prevent a recession.

Summing up her approach, Truss insisted that “you simply cannot tax your way to growth”.

What is Sunak’s plan?

Sunak said that Truss’s economic strategy would pour “fuel on the fire” and cause “misery for millions”. The former chancellor has …read more

Source:: The Week – All news


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