Liz Truss has made a firm pledge of “no new taxes” if she becomes prime minister next week.
Ms Truss also specifically ruled out a new windfall tax on energy companies which are raking in massive profits as a result of the historic spike in gas prices.
And she promised that there will be no French-style energy rationing this winter, when average domestic fuel prices are set to rise to an annual £3,459.
Her commitments come at a time when experts are warning that the government faces the need for tens of billions of support funding to help households and businesses keep the heating on this winter.
If she is elected Boris Johnson’s successor, as expected, on Monday, her promises risk significantly limiting her room for manoeuvre as she draws up a response to warnings of destitution for families and closure for small businesses if support is not delivered.
Ms Truss’s leadership rival Rishi Sunak made clear he was ready to impose a further windfall tax on energy giants, insisting it was “absolutely right” at a time when the companies are “making billions of profit because of war”.
And he said that as PM he would not rule out energy rationing of the kind being considered by France’s Emmanuel Macron.
“We shouldn’t rule anything out,” said Mr Sunak. “The challenges we face with this crisis are significant. Many European countries are looking at how we can all optimise our energy usage, that is a sensible thing for us to be doing as a country.”
The energy crisis came to the fore at the final hustings of the campaign to chose a replacement for Mr Johnson, with one small businessman in the audience of 6,000 Tory members at Wembley demanding to know what help will be offered to him to help him pay astronomical bills.
Ms Truss said that direct support to households would be her “third priority” in responding to the energy crisis, after tax cuts and moves to boost security of supply.
She said she would “absolutely be looking to act on business energy costs” but refused to set out details of her plans ahead of the emergency budget she has promised soon after she enters No 10.
“In a fiscal event, the chancellor would address the issue of household support,” Ms Truss said. Asked whether this could include a cut in VAT from 20 to 15 per cent, as reported, she told moderator Nick Ferrari of LBC radio: “I’m not ruling things in or out. I’m not sitting here writing a future budget or fiscal event.”
And challenged over whether she could match Mr Johnson’s 2019 pledge of “no new taxes”, she replied without hesitation: “Yes. No new taxes.”
Mr Sunak, who described himself as “the underdog” in a video introducing himself to the stage, renewed his assault on Ms Truss’s plans for tax cuts which he believes will add fuel to soaring inflation.
And backer Michael Gove hammered home the attack, describing inflation as “the thief in the night that robs savings and impoverishes all.”
In a swipe apparently directed at Ms Truss’s insistence that she could safely cut taxes at a time of soaring prices, Mr Gove said: “Rishi, throughout his time in government, throughout his time in this campaign, throughout all the years I have known him, he has always told the truth. He is a leader all of us can trust.”
The former chancellor paid tribute to his parents, who were present in the audience, for making sacrifices to give their children a better life.
And – in what has become a ritual reference to his short stature – he thanked his wife Akshata for “giving up the heels and taking a chance on the short kid with the backpack”.
Despite polling suggesting he is trailing Ms Truss by a substantial margin among the approximately 160,000 Tory members with a vote on the leadership, Mr Sunak received a warm welcome from the Wembley crowd, with sustained chants of “Rishi! Rishi!”
He paid tribute to Mr Johnson, thanking him profusely for his service in an apparent attempt to damp down accusations from grassroots Tories that he betrayed the PM by resigning as chancellor.
But he took a veiled swipe at Johnson’s behaviour in power, promising: “I will lead a government that is conducted competently, that is conducted seriously, and with decency and integrity at the heart of everything that we do. That is the change that I am going to bring”.
Unlike Ms Truss, he pledged to appoint an independent ethics adviser at No 10.
And he attempted to build bridges with Ms Truss after their brutal “blue-on-blue” exchanges during the six-week campaign.
In what was immediately interpreted as an indication that he is ready to take a job in a Truss administration, he said: “I agree with Liz on far more than we disagree on – and I don’t just mean our shared love of Whitney Houston and Taylor Swift. When this is done, we are going to come together.”
Ms Truss won loud applause as she promised to run an “unashamedly pro-business” government and to take on “identity politics”, declaring that she does not believe that a trans woman is a woman.
She also said she would scrap the experiment with smart motorways, which she said “hasn’t worked”. And she agreed to “look at” an audience member’s proposal to make the 70mph speed limit on motorways advisory rather than compulsory.
After causing a diplomatic spat by telling a previous hustings that the “jury is out” on whether Mr Macron is a “friend or foe”, Ms Truss dodged the same question with regard to Donald Trump.
And she declined to say whether she would accept a invitation to cocktails with Mr Trump or former deputy prime minister Nick Clegg, saying that if she was in the US her priority would be to speak with president Joe Biden.