The new minister said in an emergency statement on economic measures that only the tax cuts that have already entered the legislative process will be kept
London, Thanasis Gavos
Britain’s new Chancellor of the Exchequer, Jeremy Hunt, has announced the reversal of “almost all” of the tax cuts included in the Truss government’s controversial mini-budget presented just three weeks ago.
At the same time, he announced a significant cut to the household support package against the energy precision that was Liz Truss’ “flagship”.
THE new minister said in an emergency statement for the economic measures, how only the tax cuts that have already entered the legislative process will be maintained, i.e. the following only two measures: the abolition of the increase in social security contributions and the reduction in stamp duty for the purchase of a first home.
All other tax measures announced by Mr Hunt’s predecessor Kwasi Kwarteng are being scrapped. Chief among them is the indefinite postponement of the reduction of the basic income tax rate from 20% to 19%.
Changes to dividend tax and the creation of VAT-free shopping zones are also cancelled, among other things. In total the government is saving just over £32 billion a year by canceling the tax cuts.
Already Prime Minister Liz Truss has taken back the scrapping of the top rate of income tax of 45% and the scrapping of the rise in corporation tax from 19% to 25% (from next April).
As for the other part of the mini-budget, the household and business support packages against energy precision, Hunt said they would be kept but that it would be looked at how they could be made more targeted from April, at less cost to the state.
It is noted that the opposition Labor proposal was initially for a support package until April and then support financed by a tax on the surplus profits of energy companies.
Jeremy Hunt has repeated several times that with his announcements he wants to restore “confidence and stability” in Britain’s public finances.
He announced further “difficult decisions” regarding taxes and government spending, which, as he said for the first time, will need to be reduced in some areas, despite Mrs. Tras’s repeated assurances to the contrary.
The measures announced in summary form will be announced in more detail at an emergency sitting of the House of Commons this afternoon, while Mr Hunt will present the government’s full medium-term budget plan on October 31, as planned after another setback by the Trudeau government. .
The almost total cancellation of Liz Truss’ economic program is believed to leave her even more exposed to internal party processes to oust her.
On the other hand, the government hopes that rewriting economic policy from scratch, just 25 days after the mini-budget, will calm the markets and thereby ease political pressures.
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