Politics latest: Chancellor Jeremy Hunt tempers tax cut expectations as he says budget 'will be affordable' (2024)

That's all for our live coverage from the Politics Hub today.

Make sure to join us tomorrow - and throughout the rest of the week - as we wait for the chancellor's budget on Wednesday.

Catch up on this morning's news below...

By Paul Kelso, business correspondent

Jeremy Hunt is considering ending or reducing "non-dom" tax breaks that allow wealthy individuals to live in the UK while their wealth is considered as residing overseas.

Sky News understands the measure is on a list of potential revenue raising measures being assessed ahead of next week's budget, and could be enacted to give the chancellor room to cut universal taxes.

The move, first reported by the Financial Times, could raise more than £3bn for the exchequer and would be politically eye-catching given Mr Hunt and successive Conservative governments have resisted calls to abandon it - arguing it makes the UK more attractive to foreign wealth creators.

It is also personally sensitive for the prime minister, whose wife Akshata Murty, daughter of the billionaire founder of the Indian software giant Infosys, previously benefited from non-dom status.

Read more below....

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Political correspondent Serena Barker-Singh explains below...

Ahead of his budget this week, Jeremy Hunt is also having to keep an eye on his performance closer to home.

The Liberal Democrats are clearly focussed on winning his seat ofSouth West Surrey, nestled under London in the so-called "blue wall".

One poll has suggested that the Lib Dems are six points ahead of Mr Hunt in the public's estimation - although constituency level polling is always tricky and this survey only asked around 500 people, when most polling involves 1,000 to 2,000 participants.

The data, provided by Survation to the Guardian through the campaign group 38 Degrees, puts the Lib Dems on 35%, the Conservatives on 29% and Labour on 22%.

Treating this as a pen portrait of the situation, rather than a definitive temperature taking of what will happen, it appears Mr Hunt is under increasing pressure to hold his seat.

While Labour and Liberal Democrats deny any conspiring to tactically unseat Conservative MPs, this is one area where - if Labour don't divert resources - a coalition of voters could provide a new "Portillo moment".

Liberal Democrat deputy leader Daisy Cooper MP said: "It's no wonder that Jeremy Hunt is on the brink of his losing his seat when people across Surrey are furious they can't get GP appointments, that their hospitals have been left to crumble, and water firms are still allowed to pollute their rivers.

"In the chancellor's own backyard, food bank demand is surging after his government failed to get a grip on the cost of living crisis.

"Liberal Democrats are fired up in Surrey to oust Conservative MPs who have taken people for granted.

"Across Surrey, it will be a two horse race between out of touch Conservative MPs, or hard-working local Liberal Democrats."

Our panel have been discussing what the general is going to look like - when it happens.

Salma Shah, a former Home Office advisor, says it's going to be "much more American" - and we're going to get "very jaded by it".

Linda Yueh, an economist, reckons it's going to include "arguing over very small differences" - and she'd like to see a broader conversation about what society should be like.

Stephen Bush, an associate editor at the Financial Times, says it will be "scrappy" - with Labour not wanting to endanger its poll lead while the Conservatives try to get the opposition to says "something - anything - controversial".

Baroness Shami Chakrabarti, the Labour peer and human rights lawyer, is speaking to Trevor Phillips about Rishi Sunak's speech on Friday.

This address came after the election of George Galloway, and also the suspension of Lee Anderson from the Conservative parliamentary party.

Baroness Chakrabarti, a former director of the charity Liberty, says the most "sinister" part of the speech was Mr Sunak "almost suggesting that he has read the riot act to the police".

She says: "I think in a liberal democracy - and he's now claiming to be a liberal patriot, I think that was the language he used - we don't have prime ministers interfering with operational policing."

The Labour peer says this has happened a number of times under Mr Sunak, where police chiefs are called into Downing Street, and then a press release is put out about what they have been told by the prime minister.

Challenged about her use of the word sinister, Baroness Chakrabarti says she uses it because of the "cheek" of Mr Sunak talking about those issues "when so many of his ministers and senior Conservatives have been pouring fuel on the flames of polarisation, culture war, division in our country" - singling out Lee Anderson and Suella Braverman.

Phillips also speaks to journalist Sarfraz Manzoor.

Mr Manzoor says the speech, in his view, was "something born from calculation and cynicism, rather than conviction".

He says that too many politicians on both sides seem "more comfortable in banalities and fudges" and "spouting pieties rather than actually speaking with conviction".

"And therefore, if you don't have people who can speak with clarity and with nuance, then I think that this territory gets surrendered to people who do speak with conviction, even if what they're saying is absolute nonsense," Mr Manzoor says.

After Sunday Morning with Trevor Phillips spoke to the chancellor this morning, we also hadShevaun Haviland, the director general of the British Chamber of Commerce, and Paul Nowak, the general secretary of the TUC, on.

Ms Haviland tells us that business wants to see things about the long term with are sustainable for the economy and focus on a thriving economy, growing business and creating more jobs - as this means "more taxes".

She says the technical recession the UK was in is likely to end.

Ms Haviland adds that she would like to see changes where the threshold business pay VAT, and movement on "international tax-free shopping and skills".

Mr Nowak says he was not cheered by Mr Hunt's speech, and that he is "really worried, that the budget will be "long on gimmicks and short on real action" to address issues with the economy.

He says he wants to see a "real, coherent industrial strategy", a and a plan for public services.

Phillips says that both are "rather lukewarm about tax cuts" - and would prefer to see greater changes.

Trevor Phillips asks Labour's Bridget Phillipson whether Labour needs to reevaluate its policy on Gaza and how it treats Muslim voters.

The point is put to her that Muslims don't feel represented by Labour.

Ms Phillipson says her party needs to be "responsible" on foreign policy, and "in keeping with how we would seek to conduct ourselves if we were to form the next government".

She says that Labour wants to see aid going into Gaza, the release of hostages and an immediate humanitarian ceasefire.

Ms Phillipson once again apologises for the situation in Rochdale, where Labour abandoned its candidate after an antisemitism scandal.

After the chancellor spoke to Trever Phillips earlier, Labour's shadow education secretary Bridget Phillipson is now talking to Sky.

She says it would be an "abject humiliation" if the Conservatives co-opt the Labour policy to scrap the non-dom tax status.

Ms Phillipson says: "Conservative cabinet ministers have spent years rubbishing this idea.

"If they were to do it, I think it would just demonstrate that it's Labour who are leading the charge where it comes to the battle of ideas in our country."

Asked if Labour would scrap the charitable status of private schools to raise extra money, Ms Phillipson says Labour's plan is to "end the tax breaks that private schools enjoy" and put that into state schools.

She is asked again about the charitable status but repeats the stance of ending the tax breaks.

Phillips asks Ms Phillipson if Labour plans to undo tax cuts in the budget if they become the next government.

The shadow education secretary says this is a hypothetical about a budget that hasn't happened yet - but says, in terms of principle, she wants to see that "we've got fairer tax overall", and criticises the government's record on tax in recent years.

Jeremy Hunt is asked by Sky's Trevor Phillips about Prime Minister Rishi Sunak's speech last week.

Asked which "small groups" have hijacked "our streets", Mr Hunt says this is for the home secretary - and he "can't give you the name" of any one group.

Mr Hunt says the "vast majority of British Muslims want to protest peacefully and within the law, and they have every right to do so".

Trevor asks "who are you talking about" when the government talks about mob rule.

Mr Hunt says "I don't know the names of people I see on television" - but then says he has had emails from people - specifically Jewish people - saying they are "absolutely terrified" of going out of the house during pro-Palestine demonstrations.

Phillips asks again which "anonymous forces or groups or organisations" the government is referring to.

Mr Hunt says he is not talking about people protesting anonymously, but he rather does not know who is protesting when he sees it on television.

Asked if the government is seriously saying the UK is under mob rule on Saturdays, Mr Hunt says: "Well, let me put it this way.

"You know, I'm not Jewish, but I've been contacted by Jewish people who've told me that they are afraid to go outside their front door when those marches are happening.

"And I think it is very important that we restore the social fabric of this country, so that people understand that when there are demonstrations, they will be peaceful and within the law and they are not intimidatory.

"And I think we have seen some of that, and the prime minister was rightly saying we need to call that out."