London Daily

Focus on the big picture.
Friday, Jul 04, 2025

Chancellor Nadhim Zahawi prepares multibillion-pound tax cuts for businesses weathering energy crisis

Chancellor Nadhim Zahawi prepares multibillion-pound tax cuts for businesses weathering energy crisis

The government must learn lessons from the pandemic, according to the chancellor, and step in to support businesses teetering on the brink.
The chancellor is preparing a multibillion-pound package of tax cuts to help businesses struggling with soaring energy costs.

Nadhim Zahawi is drawing up emergency plans to save companies on the brink of collapse for the incoming prime minister, who will be named on Monday.

According to The Times, the chancellor believes the government can learn from the pandemic and introduce targeted cuts in VAT and business rates to protect the retail and hospitality sectors.

Failing to act, Mr Zahawi has warned lawmakers, could lead to a wave of bankruptcies and economic scarring.

The chancellor could also give tax breaks to energy-intensive industries such as steel, paper, glass, ceramics and cement producers.

He also reportedly urged people not to “panic” about inflation and the worsening cost of living crisis.

Liz Truss is the frontrunner to win the Conservative leadership election, and the outgoing chancellor is thought to be in line for a top job should she win.

He has insisted that Ms Truss, if elected, would “deliver help” to families and businesses in need, according to The Times.

The foreign secretary has been criticised by politicians from across the spectrum for failing to outline any specific policies that she would enact to tackle the energy crisis if she were to become prime minister.

Small companies are teetering on the brink of collapse as energy prices continue to soar, according to the Federation of Small Businesses (FSB).

Almost 15% of small and medium-sized firms expect they could be compelled to close or downsize as a direct result of the spiralling energy bills, according to a poll by the FSB.

Mr Zahawi told The Times: "The lesson from COVID is that actually there are some levers like VAT, like business rates.

"Targeting particular sectors of the economy, whether it’s hospitality or high energy use sectors, can be done very effectively. But as I say there are no easy options."

At the same time, households around the country say they are planning to stop paying their energy bills come October.

At least 1.7 million households plan to cancel their energy direct debits when the next price cap rise kicks in, according to research published by Opinium this week.
Newsletter

Related Articles

0:00
0:00
Close
DJI Launches Heavy-Duty Coaxial Quadcopter with 80 kg Lift Capacity
U.S. Senate Approves Major Legislation Dubbed the 'Big Beautiful Bill'
Largest Healthcare Fraud Takedown in U.S. History Announced by DOJ
Poland Implements Border Checks Amid Growing Migration Tensions
Political Dispute Escalates Between Trump and Musk
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
US Senate Votes to Remove AI Regulation Moratorium from Domestic Policy Bill
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
Jury Deliberations in Diddy Trial Yield Partial Verdict in Serious Criminal Charges
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
King Charles Plans Significant Role for Prince Harry in Coronation
Two Chinese Nationals Arrested for Espionage Activities Against U.S. Navy
Amazon Reaches Major Automation Milestone with Over One Million Robots
Extreme Heat Wave Sweeps Across Europe, Hitting Record Temperatures
Meta Announces Formation of Ambitious AI Unit, Meta Superintelligence Labs
Robots Compete in Football Tournament in China Amid Injuries
Trump Administration Considers Withdrawal of Funding for Hospitals Providing Gender Treatment to Minors
Texas Enacts Law Allowing Gold and Silver Transactions
China Unveils Miniature Insect-Like Surveillance Drone
OpenAI Secures Multimillion-Dollar AI Contracts with Pentagon, India, and Grab
Marc Marquez Claims Victory at Dutch Grand Prix Amidst Family Misfortune
Germany Votes to Suspend Family Reunification for Asylum Seekers
Elon Musk Critiques Senate Budget Proposal Over Job Losses and Strategic Risks
Los Angeles Riots ended with Federal Investigations into Funding
Budapest Pride Parade Draws 200,000 Participants Amid Government Ban
Southern Europe Experiences Extreme Heat
Xiaomi's YU7 SUV Launch Garners Record Pre-Orders Amid Market Challenges
Jeff Bezos and Lauren Sanchez's Lavish Wedding in Venice
Russia Launches Largest Air Assault on Ukraine Since Invasion
Education Secretary Announces Overhaul of Complaints System Amid Rising Parental Grievances
Massive Anti-Government Protests Erupt in Belgrade
Trump Ends Trade Talks with Canada Over Digital Services Tax
UK Government Softens Welfare Reform Plans Amid Labour Party Rebellion
Labour Faces Rebellion Over Disability Benefit Reforms Ahead of Key Vote
Jeff Bezos and Lauren Sánchez Host Lavish Wedding in Venice Amid Protests
Trump Asserts Readiness for Further Strikes on Iran Amid Nuclear Tensions
North Korea to Open New Beach Resort to Boost Tourism Economy
UK Labour Party Faces Internal Tensions Over Welfare Reforms
Andrew Cuomo Hints at Potential November Comeback Amid Democratic Primary Results
Curtis Sliwa Champions His Vision for New York City Amid Rising Crime Concerns
Federal Reserve Proposes Changes to Capital Rule Affecting Major Banks
EU TO HUNGARY: LET THEM PRIDE OR PREP FOR SHADE. ORBÁN TO EU: STAY IN YOUR LANE AND FIX YOUR OWN MESS.
Trump Escalates Criticism of Media Over Iran Strike Coverage
Trump Announces Upcoming US-Iran Meeting Amid Controversial Airstrikes
Trump Moves to Reshape Middle East Following Israel-Iran Conflict
Big Four Accounting Firms Fined in Exam Cheating Scandal
NATO Members Agree to 5% Defense Spending Target by 2035
Australia's Star Casino Secures $195 Million Rescue Package Amid Challenges
UK to Enhance Nuclear Capabilities with Acquisition of F-35A Fighter Jets
×