𝓤𝓷𝓲𝓽𝓮𝓭 𝓝𝓮𝔀𝓼

Andy Burnham has been urged to cut taxes, as rising inflation means households are continuing to struggle with the cost-of-living crisis. Mr Burnham’s Chancellor, John Healey, could increase taxes when he delivers his first Budget on October 28.

But new polling found voters want to see lower taxes, even if it means cuts to spending on public services. The Ipsos survey found 45% of British adults now say it is essential that tax is cut, up from 36% in February. A smaller proportion, 32%, want higher spending. Others do not know or have no preference. But 70% of voters said they believed Labour was likely to put up taxes anyway.

Mr Burnham has vowed to stick to Labour’s manifesto promise not to increase the rate of income tax, National Insurance or VAT. But he has also said he cannot rule out increasing the additional 45% rate of income tax, paid by higher earners. while other tax rises remain possible.

Gideon Skinner, senior director at Ipsos in the UK said: “These latest figures show the challenges that will face Andy Burnham’s new government as household budgets remain under sustained pressure.

“Demand for better-quality public services has been a consistent theme over recent years, but we are also seeing a growing proportion of Britons prioritising direct tax relief and national debt reduction over higher state spending funded by taxes or borrowing.”

He said the Chancellor faces “a key challenge” if the Government hopes to pay for long-term infrastructure without pushing up tax bills for families.

UK inflation has jumped to its highest rate since March after energy prices were pushed up by the Iran war, according to official figures.

The Office for National Statistics (ONS) said Consumer Prices Index (CPI) inflation rose to 2.9% in July, up from a 15-month low of 2.6% in June.

It follows a 13% hike in Ofgem’s energy price cap last month, which increased the average gas and electricity bill by £221 to £1,862 a year.

The ONS said the rise in the cap was driven by the biggest rise in gas prices for almost four years.

Ofgem will announce the next price cap level for October to December on August 26, with the latest forecasts on Wednesday from experts at Cornwall Insight showing a 4% rise is expected, taking the average tariff to £1,941.

The Prime Minister said inflation had risen due to “the effect of the conflict in the Middle East”, as he responded to it reaching its highest rate since March.

Speaking during a visit to the North East, Mr Burnham said: “We can’t control though what is going on in the Middle East and the effect of the conflict there is now being felt in inflation here, and in other countries around the world.

“But people can be sure that what I can do to help people, I will do, I realise these times are really hard but already people can see a month into office I have done things that will make a difference”.

He had earlier said: “I want to lead a cost-of-living Government, and I’ve already taken steps as Prime Minister to show I will help people wherever I can. I can’t do everything, I think people know that. We’re in tough times, but where I can do something to make life that little bit better, I will do it.

“So I’ve made a commitment to take VAT off electricity bills, and that will come in from October. I’ve made a further commitment to reinstate the £2 cap on bus fares for the whole of 2027. That will help people as well. Both of those measures help with inflation.”

Conservative Shadow Chancellor Sir Mel Stride said: “Price rises are accelerating once again under Labour.

“When the Conservatives left office, inflation was bang on the 2% target; now it has been above that level for 22 months in a row. This will be a worry for families across the country.

“Labour’s tax rises and business bashing have driven the cost of living higher and higher, yet Andy Burnham refuses to rule out yet more tax hikes at the Budget.

“Labour’s economic mismanagement has left us unprepared for global shocks, with the UK having the highest inflation in the G7 at the start of the Iran crisis.

“It is ordinary people who are left paying the price.”

Reform UK’s Treasury spokesman Robert Jenrick has accused the Prime Minister of “exploding people’s bills” as the UK’s inflation rate rises to 2.9% in the year to July.

Mr Jenrick said: “Andy Burnham talks a big game, but so far all his policies are doing is exploding people’s bills.

“The only way to cut the cost of living is to stop wasting money on foreign aid and benefits and spend it on working people instead.

“This Prime Minister seems just as unwilling as Keir Starmer to do that.”