Jeremy Hunt says now is the moment for growth as he signals tax cuts

Jeremy Hunt has given his strongest hint yet that he will unveil tax cuts in his autumn statement as he considers cutting those on inheritance and businesses while squeezing benefits by billions.

Ahead of Wednesday’s financial announcement, the Chancellor said that now is a “turning point for the economy” and that “this is the moment” to go for growth.

But he argued that there is a need to “reform our welfare system” as he said the “priority” for the autumn statement is helping firms.

Mr Hunt is also considering slashing inheritance tax, which would be bound to draw criticism for supporting the wealthy while others struggle with the high cost of living.

Inflation graphic
(PA Graphics)

Conservative former chancellor Lord Clarke said the move may please MPs on the Tory right who are clamouring for tax cuts as the party lags more than 20 points behind Labour in the polls, but others would find it “appalling”.

In a sign he will go with tax cuts next week, Mr Hunt told The Telegraph: “Without pre-empting the decisions that the Prime Minister and I make, this is an autumn statement for growth. It’s a turning point for the economy.”

He said the country has “turned the corner in a big way” after Prime Minister Rishi Sunak’s pledge to halve inflation was met this week.

Asked if now was the time to go for economic growth, Mr Hunt said: “Yes, absolutely. This is the moment. We’ve got to go for it as a country and I think we’ve got a big, big opportunity.”

He added: “The big message on tax cuts is there is a path to reducing the tax burden and a Conservative government will take that path.”

Typically ministers use the September figure for inflation when uprating working-age benefits, which would mean a 6.7% hike.

But Mr Hunt has not ruled out using October’s far lower figure of 4.6%.

Asked about the possible move in an interview with the BBC during a visit to a manufacturer, the Chancellor said: “We will always be a compassionate Conservative government but part of how we make our economy successful is by making sure companies like this company can find the staff they need.

“Nearly a million vacancies across the economy, so we do need to reform our welfare system.”

Sources said a decision on the figures is yet to be made.

Ministers have already announced a fresh welfare crackdown amid efforts to get people back into work under a toughened sanctions scheme.

Free prescriptions and legal aid will be cut off for benefit claimants who are deemed fit to work and do not seek employment.

There are hopes the final forecasts from the Office for Budget Responsibility will give Mr Hunt more “fiscal headroom” than expected to make tax cuts when he receives them on Friday.