Autumn Statement 2022 – live: Hunt calls tax hikes a ‘horrible decision’ amid warnings of ‘grim years ahead’

Jeremy Hunt unveiled a package of tax rises worth £24bn and spending cuts of £30bn in order to plug a massive funding black hole in Treasury coffers and reassure the global financial markets that Britain remains a trusted trading partner.

His programme was tipped in advance to contain a number of “stealth taxes” to draw in additional revenue from income tax, national insurance, pensions savings, inheritance tax and VAT in the long to medium term.

But what exactly is meant by a “stealth tax”?

Jeremy Hunt has delivered his autumn statement, confirming tax rises for millions and deep public spending cuts as he seeks to repair the public finances following a series of shocks to the economy.

Mr Hunt set out some £30 billion in spending cuts and £24 billion in tax rises over the next five years.

Matt Mathers details some of the measures included in the budget and what they mean:

What he said: “We are honest about the challenges and we are fair in our solutions.”

What he meant: “Liz Truss sold you fairytales and Labour are pretending that her tax cuts for the rich are still happening.”

Our chief political commentator John Rentoul imagines what the chancellor was thinking as he delivered his fiscal event.

In his autumn statement designed to rein in inflation and restore financial stability, Jeremy Hunt deployed stealth taxes totalling £25bn and £30bn of cuts to public services to fill a £55bn gap in the government’s books.

Director of the Institute for Fiscal Studies, Paul Johnson, said: “The next few years look grim in terms of living standards, the biggest reduction in household incomes, possibly on record and certainly within recent generations.”

“Painful” interest payments on state debt are at their highest since 1948 at 4.8 per cent of GDP and will soon top £100bn a year, more than spending on any public service apart from the NHS, he said.

Andrew Woodcock, Rob Merrick report:

Jeremy Hunt denied deferring “a horrible decision” in his autumn statement despite postponing spending cuts until after the next elections.

The chancellor told ITV’s Peston programme: “Well I think that a Conservative Chancellor who stands up in the Commons and announces £25 billion of tax rises, I don’t think anyone would say that is deferring a horrible decision.

“That is confronting this problem head on and what support we can give to the economy in the next two years, of course we do while we’re going through a recession.

“But in the end what the country wants, what families want, is the confidence that comes from honesty about the problems but also having a plan in place that gives them hope for the future that we can get through this, as we absolutely can.”

Jeremy Hunt has warned of real challenges for families while defending his autumn statement.

In an interview with BBC’s political editor Chris Mason, Mr Hunt said: “These are real challenges for families up and down the country.”

“I’m not pretending these aren’t going to be difficult times, but there’s a plan, there’s hope – and if we follow this plan, if we stick with it, we can get through to the other side.

“We need to be sensible about the way we do this. We don’t want to make the recession worse.”

He also denied that he had been forced to raise taxes and reduce spending because of the turmoil caused by former prime minister Liz Truss’s mini-Budget.

He said that the government had “corrected” mistakes within weeks.

Jeremy Hunt’s autumn Budget will not mirror the wish list of policies advocated by environmentalists and climate campaigners in the UK and abroad.

But there are some bright spots that many will find reassuring after months of concern about the growing influence of the net-zero sceptical wing of the Conservative Party.

Unveiling his statement, Mr Hunt said the UK remained “fully committed” to the Glasgow Climate Pact agreed at Cop26 last year, including meeting a 68 per cent reduction in greenhouse gas emissions by 2030, he added.

Those words were welcomed by environmentalists, who are anxiously awaiting the final outcome of the Cop27 summit in Egypt that is due to draw to a close on Friday. But, as ever, the devil is in the detail.

Jeremy Hunt has delivered his autumn statement, confirming tax rises for millions and deep public spending cuts as he seeks to repair the public finances following a series of shocks to the economy.

The chancellor said his plan would aim to “rebuild our economy” in the aftermath of the Covid pandemic, Liz Truss’s disastrous September mini-Budget and Russia’s ongoing war in Ukraine, which is fuelling rampant inflation.

Addressing MPs in the House of Commons on Thursday morning, Mr Hunt said the government’s priorities “are stability, growth, and public services”. He also vowed to “protect the most vulnerable.”

Businesses have welcomed the chancellor’s £13.6 billion package of property tax support.

The move means business rates will no longer be hiked in line with double-digit inflation from April.

The Treasury also pledged to increase rates relief for retail, hospitality and leisure firms from 50 per cent to 75 per cent for 2023 to 2024.

Robert Hayton, the UK president of real estate adviser Altus Group, praised the autumn statement as a “budget for the embattled high street” that has listened to and acted upon the concerns voiced by retailers.

He said: “This is a budget for the embattled high street where rents have been in decline for a number of years.”

Helen Dickinson, chief executive of the British Retail Consortium (BRC), which works with more than 5,000 business members, said the announcements showed the government has “heard the concerns of the retail industry”.

“This autumn statement supports retailers by reducing upwards pressure on prices in the short term, and helping retailers protect jobs, keep shops open, and protect the vibrancy of local communities.”