UK Chancellor Defends Decision to Raise Taxes for UK’s ‘Squeezed Middle’

The Chancellor of the Exchequer, Jeremy Hunt, delivers his autumn statement in the House of Commons in London on Nov. 17, 2022. (Jessica Taylor/UK Parliament via PA)

The UK’s Chancellor of the Exchequer, Jeremy Hunt, has defended his decision to raise £25 billion ($30 billion) by raising taxes amid claims by some economists that it would hurt middle-income earners, the so-called “squeezed middle.”

Hunt was criticised by former Business Secretary Jacob Rees-Mogg, who said he had taken the “easy option” and should have reduced public spending more, rather than raise taxes.

But Hunt said on Friday there was “nothing Conservative about ducking difficult decisions.”

Rees-Mogg said the country needed lower taxes—something Hunt’s predecessor, Kwasi Kwarteng, tried to do in his mini-statement last month—to drive up growth during a recession.

Britain's Brexit Opportunities and Government Efficiency Secretary Jacob Rees-Mogg addresses delegates during the Conservative Party Spring Conference, at Blackpool Winter Gardens in Blackpool, northwest England, on March 18, 2022. (Paul Ellis /AFP via Getty Images)

Hunt told Sky News: “None of this is easy, but it’s the right thing to do. What I would say to my Conservative colleagues, is there is nothing Conservative about spending money that you haven’t got.”

He said, “There is nothing Conservative about not tackling inflation, there is nothing Conservative about ducking difficult decisions that put the economy on track, and we’ve done all of those things and that is why this is a very Conservative package to make sure we sort out the economy.”

Hunt Says ‘Sound Money Matters More Than Low Taxes’

Hunt told BBC Radio 4’s “Today” programme that “sound money matters more than low taxes.”

Money-saving expert Martin Lewis said he met Hunt earlier this week and pressed the case for easing the burden on the “squeezed middle.”

Lewis told LBC Radio: “We will see next spring we are going to have this perfect storm of energy bills going up, cost of living continuing to rise, and energy bills at their peak. My concern is what do we do to get people over that hump.”

Economists from the Resolution Foundation said Hunt’s autumn statement would add further pressure on the “squeezed middle,” who face a permanent 3.7 percent hit on their income, which is bigger than that faced by the wealthiest strata of society.

Rees-Mogg told Channel 4 News: “We need to look at the efficiency of government to make sure money is well spent before reaching for the easy option of putting up taxes. What we actually need to be doing is having a strategy for growth and looking to lower taxes.”

Rees-Mogg, a Boris Johnson loyalist who was given the business secretary job by former Prime Minister Liz Truss, was ousted from the Cabinet by Rishi Sunak, who he remains at odds with over economic policy.

PA Media contributed to this report.