Sunak and Hunt plan tax cut and wage hike Rishi Sunak is reportedly planning to cut taxes and increase the national living wage in the run-up to the next election. Chancellor Jeremy Hunt is said to be considering a cut in the headline rate of income tax that would be implemented in April next year. Senior Government sources say the Prime Minister and Chancellor want to cut taxes and see an income tax cut as the best option as it is clearer for voters than measures such as an increase in the personal allowance threshold. Meanwhile, ministers are being advised that the living wage should rise from £10.42 to £11.16 an hour. Paul Johnson, head of the Institute of Fiscal Studies, said that people were unlikely to feel much better off by the time any changes occur, in part because of the impact of the Government's decision to freeze income tax thresholds. He said: “I don't think people will be feeling terribly chipper. We will have seen pretty big falls in real incomes this year and last year.”