Next week, the Chancellor is due to announce a pathway to raising corporation tax from 19 to 25 percent over the course of this Parliament. It is believed he will use the budget to “level with” the public about public finances in the wake of the coronavirus pandemic.
But now, six donors, who have given about £15million to the Conservatives, have warned any increase to corporation tax and capital gains tax (CGT) would be attacking wealth creation.
Steve Morgan, the property developer who gave £1million to the Tories’ general election campaign, said raising the taxes would be “completely and utterly wrong”.
He told: “One of the advantages of leaving the EU is that we can become a low-tax, dynamic society which can become Europe’s go-to country for investment.
“Increasing corporation tax and CGT files in the face of this.”
Sir Henry Angest also said Britain was already a high-tax country.
The banker – who donated £7million to the Tories, added: “I suspect there is a mindset at the Treasury that just doesn’t believe in the capitalist economic model.”
Peter Hargreaves, the billionaire who gave £1million to the Tory election campaign, also said: “The best Governments get out of the way of business.
“Government spending is inefficient and abused by unworthy recipients.”
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Mr Sunak is also believed to freeze the £50,000 threshold for the higher rate of income tax in a move that will raise £1billion as 800,000 people will be forced to pay the 40p rate.
The Chancellor’s budget is also expected to include giveaways such as an extension to the stamp duty holiday, the furlough scheme, and coronavirus business support.
In a YouGov poll for The Times, only five percent of the public say Mr Sunak should raise taxes or cut spending now.
Mr Sunak’s announcement on March 3 is tipped to be one of the most closely watched Budgets in a generation.
It will set out how the Government plans to balance the books and start on the road to economic recovery following the coronavirus pandemic.
Over the course of 2020, Mr Johnson and his cabinet spent £280billion on measures to fight COVID-19 and its impact on the economy.
Mr Sunak was warned against holding back on state aid and public spending as it risks turning millions of voters who chose blue for the first time in the 2019 general election.
Paul Embery, a leading trade unionist and Labour member told Express.co.uk that while it was likely the Budget will include “austerity” measures, Mr Johnson and Mr Sunak must think before they squeeze communities already squeezed by ten years of reduced funding.
He said: “The Tories, purely from an electoral point of view, probably need to think hard about another round of austerity, and what that’s going to do in terms of their support in the Red Wall seats they’ve captured.
“People there will turn against them quite quickly if they impose that austerity.”