Businessmen who have donated millions of pounds to the Conservatives are urging Boris Johnson not to increase taxes this autumn, warning it would "choke off a recovery when we need it most".
Party donors have spoken out after concerns that Mr Johnson and his Chancellor, Rishi Sunak, are willing to sanction tax rises at the Budget, expected in November, to pay the bill from tackling the Covid-19 pandemic and a new strategy to fund social care for the elderly.
Johnny Leavesley, chairman of the Midlands Industrial Council, one of the party's biggest donor groups, urged Mr Sunak "to embrace Thatcherite principles".
Mr Leavesley said: "Rishi Sunak has been the perfect Chancellor for the pandemic, generously supporting what has been necessary to keep the economy alive, but now he needs to embrace Thatcherite principles by limiting state spending and cutting taxes to stimulate economic growth."
The council – whose business leader members donate hundreds of thousands of pounds to the party every year – offered financial support to dozens of Tory candidates in the Midlands and North of England at the 2019 general election.
Urging Mr Sunak to reverse a planned increase in corporation tax and to raise the threshold of National Insurance Contributions "to help the lower waged", Mr Leavesley said: "Businesses outside the leisure sector have shown strong performance during the pandemic. As the lockdown continues to ease, the leisure sector will also bounce back.
"We need economic recovery and business growth to pay for state debt and spending. We are already highly taxed and tax rises this autumn will choke off a recovery when we need it most."
Other donors joined the calls. Lord Cruddas, who has donated £1.8 million since 2015 and was handed a peerage by Mr Johnson late last year, said: "I have seen Rishi [Sunak] on television confirm that it is not in the manifesto to increase taxes, so I am confident that they will not increase taxes.
"We are going to have the fastest growing economy in the world next year, and the EU's economy is picking up. I don't think there will be a need to increase taxes."
Alexander Termerko, who has donated about £700,000 to the party, said: "It is a mistake to raise taxes. As a party donor and activist, increases in taxes undermine our party manifesto, which stresses the importance of fiscal responsibility and reduction of taxes.
"As a businessman, I see that it will reduce our ability to compete internationally and will squander lots of benefits we received following Brexit. It is very untimely to raise taxes now."
A fourth donor – a successful businessman who has given nearly £1million over – asked not to be named, but said: "A tax is a cost to business and any time you increase the cost you get less of it.
"Boris is increasingly alienating his supporters. There are just a series of increasingly nonsensical policies, the net zero thing is utter lunacy, everyone knows it. It is just childish fantasy, posturing.
"He is to the Left of David Cameron. And David Cameron almost split the Conservative party."
Jeremy Hosking, who donated £375,000 to the party mostly during Theresa May's time as leader but who is now backing Laurence Fox's Reclaim Party, added: "The Government needs to stop doing idiotic things whilst expecting good outcomes. Magic money tree, green zealotry, now tax rises? This cannot end well."
The warnings came after Mr Sunak refused to rule out tax increases on a visit to Scotland on Friday. The Chancellor told The Herald's Brian Taylor podcast: "The public finances are important to me but they should be important to everyone.
"If you think about what we have been able to do over the past 12, 18 months, provide untold amount of support to families and businesses through a difficult period, we have only been able to do that because we have the foundations of a strong economy coming in – and I want to make sure that when the next problem comes along in the future, which inevitably it will at some point, the person sitting in my chair will be able to respond in the same comprehensive and generous way that I did and that is what the Budget [in March] set out to do."
Mr Sunak also dropped a hint that he had not ruled out a hypothecated tax to pay for social care, saying: "It is not something as a country that we have done but we have started to do it in England specifically with the adult social care precept and the police precept on council tax bills. So there is actually some hypothecation that already happens there."
A government spokesman said last night: "We don't comment on future tax policy."
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