Jeremy Hunt, the new UK Chancellor appointed by Prime Minister Liz Truss after she sacked her friend Kwasi Kwarteng in an attempt to calm the ongoing economic and political crisis, admitted on Saturday that mistakes were made by his predecessor and signalled a reversal of his tax-cutting approach.
Hunt, a former Conservative Party leadership contender who is dubbed as the most powerful man in the UK government as Truss battles to win back her credibility, also indicated that spending cuts would have to be brought in across all state departments to deal with the tough economic climate.
"Taxes are not going to come down by as much as people hoped, and some taxes will have to go up. I'm going to be asking all government departments to find additional efficiency savings," he said.
The turbulence at the very top of the UK government is far from over, with disgruntled Tory rebels and Sunak loyalists defiantly against the new leader amid her various U-turns. The fact that she fired Kwarteng just 38 days into the job for announcing policies in the mini-budget that she campaigned for is being seen as an attempt to shift the blame entirely on him for the chaos of the financial markets that ensued.
Hunt is expected to delay a 1 pence cut in income tax to help plug a black hole in the public finances that had reached £72bn, the Sunday Times reported.
Plans to reduce the basic rate of income tax from 20 per cent to 19 per cent next April will be pushed back by a year will also be announced. Hunt is also known to have batted for cutting corporation tax from 19 per cent to 15 per cent.
“Some taxes will go up … My priority, our values as a government, will be to protect families, businesses, who are going through a very challenging time,” Hunt told The Guardian.
“We’re going to be talking about tax. We’re going to be talking about spending, we’re going to be talking about medium and long-term plans,” Hunt added. “Spending will not rise by as much as people would like and all Government departments are going to have to find more efficiencies than they were planning to,” Hunt told BBC Radio 4's Today programme
Hunt also said that difficult decisions needed to be made on spending. He said that if the UK wanted well-funded public services like the NHS and to keep taxes low and falling, the growth rate of the economy should be increased.
--With PTI inputs
