Boris Johnson offers a £10 billion tax cut to high earners

Boris JohnsonGetty

  • Boris Johnson offers higher earners a tax cut worth £9.6 billion a year.
  • The frontrunner to replace Theresa May as prime minister says he would raise the higher rate threshold to £80,000.
  • His rivals accuse him of abandoning the centre ground.
  • All of the leading candidates for Conservative party leader have offered voters large tax cuts.
  • Visit Business Insider's home page for more stories.

LONDON - Boris Johnson will give Britain's high earners a tax cut costing the UK government close to £10 billion a year, if he becomes prime minister, he indicated today.

Writing in the Telegraph, Johnson said that he would raise the higher rate of tax from £50,000 in order to "help the huge numbers that have been captured in the higher rate by fiscal drag."

The Telegraph, which pays Johnson £275,000 a year for his weekly column, reported that Johnson would raise the higher rate threshold to £80,000, costing the government around £9.6 billion a year.

Johnson would also lower UK corporation tax rates, the paper reported, despite the country already holding some of the lowest business rates in the world.

He claimed the cuts could be paid for by reducing spending on no-deal preparations.

Paul Johnson of the Institute for Fiscal Studies think-tank told the BBC Radio 4 Today Programme that the biggest beneficiaries of the income tax cut would be wealthy pensioners, and those living solely off of investments.

The former foreign secretary, who is the strong favourite to replace Theresa May as prime minister, was accused by rivals of abandoning his bid to be a centre ground "One Nation" Conservative party leader.

"If you want to badge yourself as a One Nation Conservative, you focus on tax cuts and investment in infrastructure to help the lowest paid ... in all parts of this country. That's not what he's doing," the Work and Pensions Secretary Amber Rudd told the Today programme.

Conservative MP Nicky Morgan, who supports Johnson's rival Michael Gove, said: "The question for Boris is why is this a priority when you could be obviously lifting more people out of paying income tax - the lower rate taxpayers - or you could be giving people receiving child benefit an extra £15 a week."

Johnson is the latest Conservative leadership candidate to offer a large tax cut. Dominic Raab, Michael Gove and Jeremy Hunt have all also offered tax cuts costing up to £30 billion in recent weeks.

The Conservatives' opponents have accused the party of abandoning lower earners.

"Exactly as predicted, the Tory leadership race is degenerating into a race to the bottom in tax cuts," the shadow Chancellor, John McDonnell said on Monday.

"When there are 4.5 million children in poverty, 1 million elderly in severe poverty, the schools' budgets and our police service stretched to breaking point, this is the Tory priority."

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