Senior Tory Liam Fox has called on the Chancellor to make “totemic” changes to the tax system that will “unleash” Britain’s small businesses.
Invoking Margaret Thatcher’s legacy, the former Defence Secretary said the Chancellor must deliver a major shake-up, to set the Conservative Party on the path to election victory.
He said: “We need to look at the tax system, our regulatory frameworks, and the ability to access scale-up capital if we are to create this political alliance for the future.
“Jeremy Hunt, in his Autumn Statement and his Spring Budget in 2024, needs to set out why the Tory Party, and only the Tory Party, can be trusted to unleash the full talents of our small business sector.”
Dr Fox insists the Tories should come across as the natural party of choice for “every white van man and woman across this country and the natural home for every white coat man and woman in our emerging tech sector”.
And he warned that the party needs to create a “compelling narrative”, akin to former prime minister Mrs Thatcher’s 1980s home ownership revolution.
He said: “We need to re-engineer and sell our policy offers in a way as dramatic as Mrs Thatcher did in relation to home ownership.
“Too many people who have the natural aspirations to build the business and create wealth in our country do not currently see the Conservatives as their natural allies. That needs to change.
“We already have a good story to tell, but if we have to do something extremely totemic and emblematic again, in the way we did with council housing, then we should do it.
“This will require us to have enormous discipline in other fiscal areas if we are to be able to create the sort of credible offer that can create a generational affinity for our party.”
Mr Hunt is under pressure from Tory backbenchers to cut taxes ahead of the general election and may plan to create fiscal headroom for this in November’s Autumn Statement.
One option being considered is capping benefit rises. Under cost-saving options drawn up by officials, working-age benefits could be slashed in real terms if the Chancellor decides not to peg them to September’s inflation figure.
Instead, he could lift benefits by at least one percentage point below inflation or raise them in line with projected lower inflation figures for next year.
September’s inflation figure is expected to be just below 7 percent, whereas forecasters think it will fall to 3 percent by April, when the benefit rise kicks in.
Dr Fox feels the fiscal statement and next year’s Spring Budget will have a key effect at the polls, but told Tory members: “Despite the apparent gloom within much of the party, the combination of an improving economy, the fact that we are defending such a large majority and the effects of the boundary changes will all act in our favour.”