Sunak Makes VAT U-Turn In Effort To Save Leadership Bid

Rishi Sunak has promised to temporarily scrap VAT on domestic fuel bills if he becomes prime minister, despite opposing the move for months while chancellor.

- Andrew Woodcock

Labour has long called for the levy to be lifted as the cost of living crisis bites millions of families. But Mr Sunak voted against the move in January, and in February told the House of Commons it would “disproportionately benefit wealthier households”.

He later said it would be “silly” to offer additional help with bills ahead of an Ofgem decision on the energy price cap in October.

Mr Sunak’s U-turn – worth £160 a year to the average household at a cost of £4.3bn to the Treasury – is a bid to counter the appeal of Tory leadership rival Liz Truss, whose £30bn package of tax cuts promises has helped her build a commanding lead in polls of party members.

She denounced Mr Sunak’s national insurance rise as “morally wrong” last night in the early moments of the abandoned TalkTV debate.

Labour Treasury spokesperson Pat McFadden said Mr Sunak, who also adopted Labour’s windfall tax on energy companies after months of opposing it, seemed once again to be “acting as his own personal rebuttal unit”.

Meanwhile, a second element of the former chancellor’s “winter plan” came under fire from work and pensions secretary Therese Coffey.

Mr Sunak said he would encourage more people off benefits by doubling from 9 to 18 the number of hours claimants must work to avoid the requirement to look for a full-time job.