Boris Johnson has said he wants to reduce the ‘aberration’ of current high taxes caused by the ‘COVID fiscal meteorite’ – as he announces plans to help boost home ownership.
The Prime Minister appealed to the 41% of Tory MPs who voted to oust him on Monday as he tried to make it clear that the billions of pounds being spent helping people during the pandemic was not the norm and could not continue.
But in a bid to woo voters as well, he announced a review of the mortgage market, said there were plans to extend the right to buy social housing and promised “justice” for tenants.
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He blamed the cost of living crisis on COVID and the war in Ukraine, but said the government could not get out of the situation now that we are out of the pandemic.
“The overall tax burden is now very high. And sooner or later, and I would rather it be sooner than later, that burden will have to be reduced,” he told an audience at a college in Blackpool.
“It’s an aberration. The tax burden caused in large part by the fiscal meteor of COVID.
“And that has to come down because the answer to the current economic situation is not more taxes and more spending.
“The answer is economic growth. And you can’t spend out of inflation and you can’t tax your way to growth.
“So that’s why the time has come for this government to do what it has been trying to do for two years, but which has been difficult during the COVID crisis.
“And that’s to implement the supply-side reforms that will reduce the costs to government, the costs to businesses, and the costs to people across the country.”
Mr Johnson announced a series of plans to help boost home ownership, but there was nothing on how to help people cope with high household bills as he said the government was already helping with a windfall tax on oil and gas companies and a reduction in fuel. tax.
Among the plans announced by Mr Johnson were:
• Government launches ‘comprehensive’ mortgage market review to report this fall to determine best way to access low deposit mortgages
• The review will look at how other countries are doing it and said it would ‘unlock the door to home ownership’
• In what Mr Johnson called the ‘home ownership revolution’, he said the government wanted to extend the right to buy social housing and housing associations and promised there would be a “one-for-one replacement” when sold.
• There would be “justice” for tenants of private and social housing by “dealing with the scourge of abusive rental clauses”
• It would “enhance” the ability of tenants to buy full ownership of their homes with discounts of up to 90% for those “trapped with ever-rising land rents”.
• Housing assistance will go more towards a pot to pay mortgages rather than towards the owners of the houses of the housing associations
• Government to ‘change welfare rules’ so people living in social housing can use their benefits for a first mortgage instead of rent
• Ministers will ‘explore lifetime discounting and help buy ISA savings’ from Universal Credit eligibility rules
• For those who then become unemployed, Mr Johnson said the government will allow people to access help to pay their mortgage earlier than currently planned
• The review will look at how the government can use the £30bn housing aid bill to build more social housing with the potential to turn it into ‘right to buy’ options.