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'Reduce taxes now': Outgoing CBI chief calls on Rishi to slash 'highest taxes in 70 years'

23 June 2022, 08:35 | Updated: 23 June 2022, 08:41

By Sophie Barnett

Tax rates in the UK are "the highest they have been in 70 years" and should be slashed now, the outgoing president of the Confederation of British Industry (CBI) has told LBC.

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Lord Karan Bilimoria said he is "very concerned" by the country's soaring tax rates and believes it is "absolutely the wrong time" to have the highest tax burden in seven decades.

Speaking to LBC in an exclusive interview with Nick Ferrari at Breakfast, Lord Bilimoria said Rishi Sunak must urgently address the situation.

"The Chancellor has got to urgently increase investment and incentivise investment," he said.

"Growth is going to create the employment that is going to get us out of this and pay down the debts, so we are saying don't wait, don't say I'm going to reduce taxes by one per cent in 2024, reduce taxes by two per cent now."

He also criticised the Chancellor's move to slash fuel duty by just 5p - claiming it's "not even a drop in the ocean".

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"We've got some of the highest fuel duties and taxes in the world.

"Many other countries have reduced fuel for the benefit of the business, benefit of the consumers at a time like this - much more than we have - and it's entirely in the Government's hands to do that."

Asked how healthy the British economy is at the moment, the founder and chairman of Cobra Beer said the "outlook is not very good".

"Our latest CBI forecast shows that next year the UK will have a growth rate of one per cent," he told Nick.

"That's the lowest in the leading countries with the Euros at over two per cent, America at over two per cent, China at over four per cent, India at over six per cent, and we are going to be at one per cent.

"I think we've got to urgently address the situation now."

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His warning comes as the Office for National Statistics confirmed inflation rose to over 9.1 per cent in May - the highest figure in 40 years.

"Though still at historically high levels, the annual inflation rate was little changed in May," said ONS chief economist Grant Fitzner.

"Continued steep food price rises and record high petrol prices were offset by clothing costs rising by less than this time last year, and a drop in often fluctuating computer games prices.

"The price of goods leaving factories rose at their fastest rate in 45 years, driven by widespread food price rises, while the cost of raw materials leapt at their fastest rate on record."