Rishi Sunak has made it clear that he plans to keep the pension triple lock intact, while hopes for cuts to inheritance tax are dwindling. The Prime Minister is expected to increase retirement funds by 8.5% in line with the growth in wages.

Protecting Traditional Tory-Supporting OAPs

Insiders report that Sunak's commitment to the pension triple lock is aimed at preventing a backlash from traditional Tory-supporting senior citizens ahead of next year's election. There were concerns that the lock could be weakened, but this move is seen as a way to avoid any "politically suicidal" consequences.

Diminishing Hopes for Inheritance Tax Cuts

Despite pressure from MPs, Downing Street has downplayed any speculation that Sunak would reduce inheritance tax, specifically to win over Conservative voters in rural areas. Cabinet Minister Grant Shapps labeled the tax as "deeply unfair," but acknowledged that the Chancellor was constrained by fiscal limitations and the need for careful tax considerations.

Inheritance tax is currently set at 40%, but less than 4% of deaths meet the threshold for this charge. Sources have indicated that scrapping the tax is not on the agenda.

Former Cabinet Minister Sir Simon Clarke argued that income tax should take precedence over inheritance tax when considering tax cuts.

Upcoming Fiscal Events

Sunak will present the Autumn Statement this November, where it is unlikely that tax cuts will be announced. However, it is widely anticipated that there may be giveaways in the Spring Budget, which is expected to be the last major fiscal event before the election.