• Foreign Secretary Liz Truss has defended her tax-cut plans, calling them the best way to avoid a recession.
• She was speaking after telling a newspaper that she preferred lowering taxes to “giving out handouts” to help households affected by higher fuel prices.
• Ms Truss promised to cancel the April National Insurance increase, cancel a planned corporation tax increase and suspend green levies on energy bills.

Liz Truss, a Tory leadership contender, has defended her tax-cut plans, calling them the best way to avoid a recession.

She was speaking after telling a newspaper that she preferred lowering taxes to “giving out handouts” to help households affected by higher fuel prices.

During a visit to Solihull, she stated that lowering taxes would help to alleviate the cost of living crisis.

Her opponent, Rishi Sunak, wants to address inflation before cutting taxes.

Ms Truss, Foreign Secretary, has promised to cancel the April National Insurance increase, cancel a planned corporation tax increase, and temporarily suspend green levies on energy bills.

When asked how she would assist households facing rising fuel costs in October, she told the Financial Times: “Of course, I’ll look into what else can be done.

“But the way I would do things is in a Conservative way of lowering the tax burden, not giving out handouts.”

When questioned later about these remarks, she stated: “What I intend to do from the start is cut taxes, reverse the National Insurance increase, and impose a temporary moratorium on the green energy levy so that people spend less of their money on fuel bills.

“But what I’m about as a Conservative is people keeping more of their own money, growing the economy so we avoid a recession and the best way to do that is lower taxes, but also unleashing investment into our economy.”

Ms Truss also criticised Mr Sunak’s economic legacy as chancellor, citing the Bank of England’s warning this week that the UK would enter a recession as it raised interest rates by the most in 27 years.

“Under current plans, what we know is that Britain is headed for a recession,” she added.

“That is not inevitable, but we need to avoid that by making sure our economy is competitive, that we’re encouraging businesses to grow and that we are keeping taxes low.”

Her rival Mr Sunak has said he would focus on getting a grip on inflation.

Speaking at a leadership hustings in Eastbourne on Friday, he warned that if inflation is not brought under control quickly, the Conservatives will “kiss goodbye” to winning the next election.

The ex-chancellor highlighted a warning by the Bank of England that inflation could become embedded.

The Bank of England has warned inflation – currently 9.4% – could peak at more than 13% and stay at “very elevated levels” throughout much of next year, before eventually returning to its 2% target in 2024.

He said there would be “no hope that we’re going to win that next election” amid continuing rising prices.

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