David Davis slams Chancellor Rishi Sunak's 'tax raid' on self-employed

Ex-Cabinet minister David Davis slams Chancellor Rishi Sunak’s ‘tax raid’ on the self-employed to fund coronavirus bailout

  • Chancellor Rishi Sunak suggests tax hike to pay self-employed coronavirus aid
  • Mr Davis said putting taxes up for self-employed would be ‘final straw’ for many
  • Tory sources say up to 50 Conservative MPs could back rebellion led by Mr Davis
  • Coronavirus symptoms: what are they and should you see a doctor?

Former Cabinet minister David Davis last night declared war on Chancellor Rishi Sunak’s threat to make the self-employed pay for coronavirus aid with a tax hike.

Mr Davis said putting taxes up for the self-employed would be ‘the final straw’ for many. It was wrong to treat the £3billion package to protect them during the Covid-19 pandemic as a ‘trade-off’ for higher taxes, he added.

The Treasury should stop ‘sweetheart’ tax deals with big business while targeting ‘those who can least resist’ like the self-employed, Mr Davis said.

Ex-Cabinet minister David Davis during second reading of the Coronavirus Bill in the House of Commons. March 23, 2020

Tory sources say up to 50 Conservative MPs could back the rebellion led by Mr Davis, a former Brexit Secretary and battle-hardened political campaigner.

He told the Daily Mail: ‘Threatening to raise the taxes of the hardworking self-employed is wrong.’ The Tory MP said they will be vital to kick-start the economy when the coronavirus crisis is over.

Mr Davis welcomed the Chancellor’s relief for self-employed workers, but added: ‘This is not some kind of quid pro quo between the self-employed and the Government.

‘Subsidising all parts of the economy while expecting increased repayment from a single sector is not fair.’

Chancellor Rishi Sunak pictured working from home March 27 after it was announced Boris Johnson and Matt Hancock tested positive for coronavirus

Many self-employed will ‘struggle to weather the storm’ until the epidemic is over’, he said.

Large numbers of them are not well paid and will have no savings to tide them over until government cash comes through in June.

Mr Davis said: ‘Paying for that relief in higher taxes will be the final straw for many. The Treasury has a long history of seeking to raise taxes from those who can least resist, whilst allowing sweetheart deals to the big corporates. This is not the time to exacerbate that habit.’

In his statement on Thursday, Mr Sunak gave a strong hint that the self-employed will lose their tax perks in return for receiving emergency help of up to £2,500 a month now. ‘If we all want to benefit equally from state support, we must all pay equally in future,’ he warned.

The self-employed pay 3 per cent less in National Insurance contributions compared to other employees.

They argue that the lower rate compensates them for the hazards of working for themselves, such as getting no holiday pay.

 

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