Healey Opens the Door on Fuel Duty and Capital Gains Tax
The Chancellor signalled he is weighing whether the planned fuel duty rise should go ahead: “I’m conscious of these pressures and I will take them into account when I make my Budget decisions.” He also pointed to capital gains tax being the lowest of any European G7 nation, which leaves room to raise it and remain below neighbours. His room for manoeuvre, he acknowledged, is severely constrained by borrowing costs driven up by the war between America and Iran.
Two signals, pointing opposite ways. Hinting at mercy on fuel duty is the cheap gesture that buys a headline; hinting at capital gains is the expensive one that raises money from a constituency Labour is less worried about losing. Both were trailed on the eve of a conference where the unions want a bank windfall tax, which suggests the Chancellor would rather set the terms himself. He tied it to welfare with unusual moral force: reducing the number of young people out of work is “a moral duty that this Government now must pick up again… before the election”, and “I refuse to see a generation condemned to a life on benefits”. The manifesto still bars income tax, national insurance and VAT rises, which is why everything else is in play. Watch whether fuel duty survives to 28 October.