The new British finance minister, Jeremy Hunt, announced on Monday the removal of “almost all tax measures” introduced three weeks earlier. by the conservative government Liz Trusswhich plunged the financial markets into chaos.
Hunt, appointed urgently on Friday, insisted on the need to restore “stability” and specified, among his announcements, that aid to households to pay energy bills will finally be limited to six months instead of the two years initially planned.
In a televised speech, Hunt also announced that it cancels the planned reduction from 20 to 19% from April of the income tax floor, in order to reduce public debt and calm the markets.
Hunt took office last Friday, replacing Kwasi Kwartengwho was fired by Truss, after his presentation on September 23 of a fiscal plan without details of how it would reduce debt sow chaos in the financial markets.
The new minister declared today that the drastic changes to that plan, worth some 32 billion pounds (37 billion euros) a year, They intend to “guarantee financial stability and give confidence in the Government’s commitment to fiscal discipline.”
The Pound rose and interest on British public debt fell after Hunt dismantled Truss’s “growth plan” with his statementwhose political future now hangs in the balance by the opposition inside and outside his party.
Announcing the Kwarteng march on Friday, the Conservative leader reversed her decision to freeze corporate tax, and indicated that in April it will rise from 19 to 25%except for small businesses, as the previous Government had arranged.
early october Truss also annulled the planned reduction from 45 to 40% of the income tax for the highest income sectors.after receiving much criticism, in a context of high inflation and rising interest rates.
Hunt specified today that will also cancel the planned cut of 1.25 percentage points of the tax on dividends as well as purchases exempt from VAT for foreign visitors.
The minister also removed the previously announced freezefor one year from February 1, dand the tax on alcohol.
From the plan of its predecessor, only the freezing of social security contributions and reduction of the tax on the purchase of housingbecause the corresponding legislation had already been approved.
The new Economy Minister, who last night met with Andrew Baileygovernor of the central bank, will appear at 14:30 GMT in the House of Commons to give more details about the new financial strategy.
The full plan, accompanied by official growth and deficit forecasts, will be revealed on October 31.