Liz Truss and Rishi Sunak are going head-to-head in the final battle to replace Boris Johnson.
He has promised the biggest income tax cut in 30 years, vowing to slash the basic rate from 20 per cent to 16 per cent as he battles to close the gap with his rival. The move would mean millions of households paying a fifth less in income tax.
Meanwhile, Ms Truss is marketing herself as a Thatcherite who also promises tax cuts, foreign policy experience, and a track record of delivery.
The Foreign Secretary has also ruled out a second Scottish independence referendum, and said that thousands more foreign workers could be allowed into the UK to temporarily take up agricultural jobs.
Here is where the final two candidates stand on the key questions:
Taxes: The former chancellor has promised the biggest tax cut in 30 years if he becomes prime minister, vowing to slash the basic rate from 20 per cent to 16 per cent. Someone earning the average UK salary of £32,000 would save about £777 under the plans.
He has vowed to scrap VAT on energy bills for a year, delivering a saving of around £160 on the average household bill as energy prices soar this winter. He is also promising a major new investment tax cut this autumn, replacing the so-called "super deduction".
Mr Sunak had previously been resisting calls for immediate tax cuts amid the cost-of-living crisis, instead saying the nation needs "honesty and responsibility, not fairytales". He had pledged to focus on getting inflation under control and only cut taxes once that happens, presenting his position as "common-sense Thatcherism".
Borrowing: Mr Sunak has repeatedly said that the nation must balance its books. He has warned that "borrowing your way out of inflation isn’t a plan" and challenged Ms Truss on her promise to borrow more to fund her tax cuts. He said: "That is the country’s credit card and it’s our children and grandchildren, everyone here’s kids will pick up the tab for that. There’s nothing conservative about it."
Net Zero: He has committed to keeping the target of making Britain carbon neutral by 2050. To achieve that he would oversee a massive expansion in offshore wind farms, but he would maintain the ban on putting up any new turbines on land. He wants to make the UK energy self-sufficient by 2045.
Trans: The former chancellor has made it clear where he stands on trans rights. He said: "The fact that we have to have a conversation about what a woman is is quite frankly extraordinary. As a parent of two young girls and married to one, I know exactly what a woman is. We don’t need to have a debate about it. I am going to stand up for women’s rights, whether it is the language that people are now trying to erase from public life, access to changing rooms, sports – we need to stand up for women’s rights. It is not bigoted or somehow narrow-minded to say that." Mr Sunak launched his campaign by pledging a new "manifesto of women’s rights". He has pledged to protect the terms "women" and "mother" as he blamed the Equality Act for promoting "woke nonsense".
Brexit: Mr Sunak voted Leave and has said taking back control of lawmaking will give Britain a competitive economic edge. He has pledged to scrap or reform all remaining EU rules on the UK’s statute books by the next election and wants to overhaul Brussels red tape clogging up the City. He has attacked Ms Truss for voting Remain.
Defence: He has vowed to stick to the Nato target of spending two per cent of GDP on defence and has suggested he would exceed that, saying it is a floor not a ceiling. But he has refused to commit to the "arbitrary" 2.5 per cent rise promised by Boris Johnson.
Housing: Mr Sunak has pledged to speed up building in cities and on brownfield sites as well as cracking down on "landbanking" by big developers. He has suggested he wants to see government funding for affordable housing scaled back, with more incentives put in place for developers to build homes poorer people can afford to buy. He has also pledged to prevent encroachment on the green belt.
Immigration: The ex-chancellor would keep the Rwanda policy, saying it is "absolutely critical that we have control of our borders". He has said a tough approach is needed to foil "an illegal set of criminal gangs who were causing people to die in pursuit of coming here". Mr Sunak has pledged a "three strikes and you’re out" rule to deport more foreign criminals.
Education: During the first hustings event with Conservative members on July 28, Mr Sunak originally appeared to say he wanted to bring grammar schools back in England. But his team later confirmed he only meant expanding existing selective schools.
NHS: Mr Sunak would introduce a £10 fine for missed GP and hospital appointments as part of a "transformative" shake-up of the health system. He said that patients would be given "the benefit of the doubt" the first time they miss an appointment, but subsequent absences would incur charges. The system would be "temporary" as the NHS tries to clear the Covid-19 backlog of more than six million patients waiting for planned care.
Taxes: Ms Truss is drawing up Thatcherite plans to give No 10 more control over the economy, The Telegraph understands. The Foreign Secretary has announced £30 billion worth of tax cuts and would start to implement them "from day one". She would cancel the planned six per cent rise in corporation tax and reverse the National Insurance hike that came into force in April. She would also lift green levies on energy bills for two years. She has also said she would review inheritance tax as part of a general review of Britain’s tax system.
Borrowing: She has said that she plans to pay for tax cuts by putting the Covid debt on a "longer-term footing", akin to the nation's war debt from the 1940s. That would potentially involve refinancing the £311 billion borrowed during the pandemic so that it was paid back over a much more drawn out period.
Net Zero: Ms Truss backs the target overall but has said "we need to reach net zero in a way that doesn’t harm businesses or consumers". She is "very supportive of using gas as a transition fuel" and has suggested she would end the ban on fracking so it could go ahead in areas where there’s local consent.
Trans: The Foreign Secretary has hit out at "ludicrous debates about pronouns" and as equalities minister scrapped plans to reform the law so people could change gender without a medical diagnosis. She has backed feminist campaigners, including Labour MP Rosie Duffield over her statement that "only women have a cervix".
Brexit: She vociferously supported Remain during the 2016 referendum but has since transformed herself into one of the most steadfast Brexiteers in the Government. She has driven forward plans to override the Northern Ireland Protocol and has said she now regrets voting to stay in the EU. When challenged by Mr Sunak during a TV debate over why she voted Remain in 2016, she said: "Maybe I’ve learnt from that."
Foreign workers: Ms Truss has proposed allowing thousands more foreign workers to come into UK each year to temporarily take up agricultural jobs like picking fruit. She wants a "short-term expansion" to what is known as the seasonal workers scheme. The current scheme allows for about 40,000 foreign workers to come to the UK for up to six months each year to work in horticulture. It is due to end in 2024.
Defence: Ms Truss has described herself as a "freedom fighter" on Ukraine, telling Conservative Party members they could trust her to do all she can to ensure Vladimir Putin is defeated. Ms Truss would increase spending on the military to three per cent of GDP by the end of this decade and "review" the plan to cut the size of the army to 72,500. She has said Russia’s invasion of Ukraine shows the West has not dedicated enough funding to defence. Ms Truss has also unveiled plans to boost trade between Commonwealth nations and stop China from buying up influence in some of the world’s fastest developing countries.
Housing: The Foreign Secretary has pledged to rip up "Stalinist" housing targets and would make it quicker and easier for developers to build on brownfield land in "opportunity areas". She has said the UK needs to "build up more" in cities and "it’s very important that we have policies that have local consent".
Immigration: She "completely agrees" with the Rwanda policy and says "we need to have further reforms in the UK to make sure we can really stop illegal immigration". She has said she wants to see reform to the way ECHR rulings are applied in Britain but "would be prepared" to withdraw from it if necessary.
Education: Ms Truss has pledged to give all students who receive three A*s at A-level an automatic Oxbridge interview. She said that Oxford and Cambridge should give all top students a chance for a place, as she warned some teachers discourage applications because the universities are "full of toffs". She also suggested she supported delaying university admissions until after students have received their exam results, abandoning the system of applications based on predicted grades.
Scotland: Ms Truss has pledged that there will be no second referendum on Scottish independence "on my watch", as she vowed to strengthen and defend the Union. Her refusal to countenance a second referendum at any point if she becomes prime minister appears to go significantly further than Boris Johnson's earlier rejection of a second poll simply on the basis that now was "not the time".