Autumn statement: Hunt to receive OBR forecast as he eyes inheritance tax cuts

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Jeremy Hunt has promised to cut more taxes as “hard work is rewarded”.
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Cuts to inheritance tax could be on the agenda next week as Chancellor Jeremy Hunt hopes to win over Tory MPs with his autumn statement.

Mr Hunt will receive the final forecast from the Office for Budget Responsibility later on Friday, amid hopes in the Treasury there is more fiscal headroom than previously expected.

Earlier this week the Chancellor said he would use Wednesday’s autumn statement to address labour supply issues and business investment, with his speech coming days after Office for National Statistics data put inflation at 4.6% in October.

Multiple reports have indicated that inheritance taxes could be cut, although no final decision is believed to have been made ahead of next Wednesday.

The Financial Times also said that the Chancellor will hope to make tax breaks for business permanent.

Mr Hunt used the Budget in March to announce a three-year policy of “full expensing” to ensure every single pound a company invests in IT equipment, plant or machinery can immediately be deducted in full from taxable profit.

Labour and Tory MPs have urged Mr Hunt to make this a permanent change, with the Chancellor noting this would be a £10 billion commitment if implemented.

The autumn statement will form part of another crunch week for the Prime Minister, as he and ministers seek to bounce back from the blow delivered by the Supreme Court to the flagship Rwanda asylum policy.

The defeat at the country’s highest court prompted anger and frustration among restive right-wing backbenchers, many of whom have also been pressuring the Chancellor to cut taxes.

The Prime Minister offered little clue as to the contents of the autumn statement when he took questions from local residents in Worksop on Friday, telling the audience to “stay tuned” for the Chancellor’s announcements.

Ahead of next week, the Government announced a fresh welfare crackdown amid efforts to get people back into work.

Free prescriptions and legal aid will be cut off for benefit claimants who are deemed fit to work and do not seek employment, while the Treasury said digital tools will also be used to “track” attendance at job fairs and interviews under the toughened sanctions regime.

Press Association – Dominic McGrath