What is Boris Johnson’s plan for the economy?
The Tory leadership front runner plans to cut tax for higher earners
Boris Johnson has laid out his plans for the economy if he becomes the next Conservative leader and prime minister of the UK.
The former London mayor and foreign secretary is widely viewed as the front runner in the race to succeed Theresa May, who officially stepped down as the leader of the Conservative Party last week. So what would a Johnson premiership mean for British businesses and taxpayers?
Income taxThe Daily Telegraph reports today that Johnson has pledged to reduce the income tax paid by higher earners, raising the 40p threshold from £50,000 to £80,000. The move would cost an estimated £9.6bn a year, which he says would be paid for from the £26.6bn set aside by the Treasury as an insurance fund against a no-deal Brexit.
Johnson is by no means the only one of the 11 leadership candidates to propose tax cuts. Home Secretary Sajid Javid said earlier this month that while his “priority” was to cut the basic rate of income tax, he would raise the 45% income tax threshold, currently set at £150,000, says the Daily Mirror. Meanwhile, Dominic Raab has pledged to cut the basic rate, which applies to everyone earning more than £12,500, from 20% to 15%.
Brexit billIn an interview with The Sunday Times this weekend, Johnson threatened to refuse to pay the £39bn so-called Brexit divorce bill unless the terms of the UK’s exit from the EU improve. He told the newspaper: “I think our friends and partners need to understand that the monies [are] going to be retained until such time as we have greater clarity about the way forward. In getting a good deal money is a great solvent and a great lubricant.”
EU negotiator Guy Verhofstadt was quick to reply, tweeting that going back on its financial commitments to the bloc would “hurt the UK’s credibility as an international partner”. Tory leadership rival Rory Stewart said Johnson’s threat was “undignified”.
Green economyJohnson has placed significant emphasis on the environment as he unveils his prospectus. In his column for The Daily Telegraph today, he insists that the UK outside the EU can become the “cleanest and greenest economy in Europe” by “believing in the market”.
The leadership hopeful also praises the UK’s existing “green finance” schemes and proposes cutting business taxes in order to encourage green entrepreneurs with “the most competitive tax regime in Europe”. In addition, Johnson suggests using funds from the Department for International Development (DfID) to “back the brilliant British technology that can help tackle the environmental problems of the world”.