Rishi Sunak’s last-minute proposal to cut VAT on energy bills has been described as “a screeching handbrake U-turn” by the business secretary, Kwasi Kwarteng.
Kwarteng, who is supporting Liz Truss in the race to become prime minister, said on Wednesday: “If this isn’t a U-turn, I don’t know what is.”
But Grant Shapps, an ally of Sunak, defended the former chancellor’s stance, saying a VAT cut on energy bills was worthwhile and would not be inflationary.
Sunak had previously been the only candidate in the Conservative leadership contest who did not pledge to cut tax. But on Tuesday evening as his chances of leading the country appeared to be ebbing away in the polls, he announced he would scrap VAT on energy bills, saving the average household £160.
In a series of broadcast interviews on Wednesday morning, Kwarteng was damning about Sunak’s change of position.
He told Sky News he was “delighted to see that Rishi Sunak has now come late to the party and decided that tax cuts are a good idea and they’re not a fairytale. And that being a grownup … does mean that you can have tax cuts.”
Sunak had argued against the tax cut in question in February when he was chancellor, telling the Commons the policy “would disproportionately benefit wealthier households”. Sunak said the cut was “targeted and temporary” and called it a winter plan to tackle rising energy bills.
Kwarteng said: “Let’s not beat about the bush: this is a U-turn. A few months ago, he said that VAT on energy bills would disproportionately help richer people; it wasn’t targeted enough at people who are vulnerable and that’s why he decided not to go with it. People were suggesting it. He rejected that.
“Only last week he said that tax cuts were part of a fairytale, that he
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