Jeremy Hunt arrives at his home in London after being appointed Chancellor of the Exchequer following the resignation of Kwasi Kwarteng. Date taken: Friday, October 14, 2022.
Aaron Chown | Picture Pa | beautiful pictures
Britain’s new Finance Secretary Jeremy Hunt on Saturday said some taxes would have to be raised, signaling another abrupt policy by Prime Minister Liz Truss, who is fighting to save his leadership just over one month in the term.
In a bid to calm financial markets that have been unsettled for three weeks, Truss fired Kwasi Kwarteng as chancellor of Friday’s pass and scrapped parts of the country’s controversial economic package. surname.
In a rushed press conference shortly after Kwarteng’s firing, Truss said corporate tax rates would increase, abandoning her plan to stay at current levels and government spending would increase less than planned. previously planned.
Massive, unreturned tax cuts were a central part of Truss’ original plan, but Hunt said a tax increase was on the cards.
“We’re going to have some very difficult decisions ahead,” he told Sky News.
“What people want, the market wants, the country needs now, is stability,” Hunt said. “No prime minister can control the market. But what I can do is show that we can pay for our tax and spending plans and that’s going to take some very decisions. difficult in terms of both spending and taxes.”
Hunt is scheduled to release the government’s medium-term budget plan on October 31, a key test of its ability to show investors that they can restore economic policy credibility. mine.
Spending won’t increase as much as people would like, he said, and all government agencies will have to figure out how to be more efficient than they expected.
“Some taxes won’t be cut as quickly as people would like, and some taxes will go up. So it’s going to be very difficult,” he said.
Kwarteng’s September 23 financial statement caused a backlash in financial markets, so much so that the Bank of England had to step in to prevent pension funds from getting caught up in the chaos as borrowing costs higher.
Hunt said he agreed with Truss’ basic approach to economic growth, but the way she and Kwarteng did it didn’t work.
“There have been mistakes,” he said. “It’s a mistake that we’re asking for tough decisions across the board on taxes and spending to cut the tax rates of the richest.”
“It would be a mistake to fly blind and make these projections without giving people the confidence of the Office for Budget Responsibility when it says the total sums add up. The Prime Minister has realized that, That’s why I’m here.”
Truss is expected to spend the weekend trying to bolster her support within the Conservative Party, with newspapers citing lawmakers who have questioned her ability to continue her job.
On Monday, the UK government bond market faced a challenge as it will operate for the first time without the emergency buying support provided by the BoE since September 28. plummeted late Friday after Truss’ press conference.
