UK's Sunak says his priority is jobs, not tax rises

FILE PHOTO: Britain’s Chancellor of the Exchequer Rishi Sunak visits the headquarters of Octopus Energy, in London, Britain October 5, 2020. Leon Neal/Pool via REUTERS

LONDON (Reuters) – Britain’s finance minister Rishi Sunak said on Tuesday his priority was saving jobs when asked about the possibility of tax rises to pay for the soaring cost of the COVID-19 pandemic.

“I think the priority right now is on jobs,” Sunak told Sky News.

“My overwhelming focus at the moment is trying to protect and support as many jobs as possible,” he said, declining to comment on future tax policy.

“Over time, yes, you’re right, we need to have sustainable public finances … but in the short term the best way to have long-term sustainable public finances is to try and protect as much employment as possible.”

Sunak’s emergency spending measures, including subsidies to slow a jump in unemployment, will cost about 200 billion pounds this year and have already pushed public debt over 2 trillion pounds ($2.60 trillion), or 100% of gross domestic product.

The government’s flagship wage support programme is due to expire at the end of this month and will be replaced by a less generous subsidy scheme.

While Sunak has refused to rule out tax increases, experts say he is unlikely to be in a hurry to turn his focus to shrinking the budget deficit, given the parlous state of the economy.

The Institute for Fiscal Studies has said the time to pay for the government’s spending surge is unlikely to come in 2021.

Sunak’s comments on Tuesday echoed a speech he made on Monday to the annual conference of the Conservative Party.

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