How tempting it must be for Rishi Sunak to chuck in his job as Chancellor. ‘My chances of ever becoming PM have plummeted to next to nothing,’ he must be thinking, ‘so why not go off and earn some serious money instead, away from the spotlight?’ I have no insight into the state of the Sunak marriage but I wouldn’t be surprised if he was also tempted to resign for his wife’s sake. ‘Let’s get out of the public eye,’ he might well be tempted to say, ‘and enjoy being rich again.’
But if Rishi had hired me for some advice on reputation management I would give him a better idea. You have obviously wanted to be PM for a long time, so why give up now? Your political reputation is not beyond repair. But it will take a bit of imagination and a bit of bravery. This is what I suggest: lie low for a bit and draw up plans for a revolutionary Budget in the autumn. The rabbit out of the hat should be to announce you are phasing out National Insurance contributions for good, replacing them with a single rate of tax that applies to all income and capital gains, whether earned or unearned. That would cut taxes for millions of working people while raising taxes for people who live off investments. Trustafarians would hurt, but no one could complain it was unfair.
How tempting it must be for Rishi Sunak to chuck in his job as Chancellor
But before you get to National Insurance, here’s another headline-grabber: announce that you are abolishing non-dom status and that henceforth all UK residents will be taxed on their worldwide income. Instead, you will cancel planned rises in corporation tax, returning the rate to 19 per cent. The only justification for non-dom status is that it helps attract entrepreneurs who set up job-creating businesses. But it is poorly targeted. Instead of attracting businesses, it tends to attract wealthy individuals whose business interests lie elsewhere in the world – oligarchs with oil interests in Siberia, for example.
Abolishing non-dom status and cutting tax in order to attract business directly would build support for Rishi well beyond the Conservative party. It would also show him to be a serious reformer, in contrast to Boris Johnson, who seems to have few big ideas. Both measures, too, would show that Rishi is capable and willing to learn from his errors: a quality missing in many of our politicians.
Maybe the allure of generating personal wealth will prove stronger for Rishi, but I suspect his political ambition is not entirely dead yet. He should answer his critics with bold ideas.
Listen to Fraser Nelson, Katy Balls and Isabel Hardman on the latest episode of Coffee House Shots:
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