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British Chancellor of the Exchequer Jeremy Hunt made a statement in the House of Commons in London on Monday.Photo courtesy of UK Parliamentary Records/EPA-EFE
October 17 (UPI) – new british prime minister Jeremy Hunt On Monday he said he was killing most of Prime Minister Liz Truss’ tax cuts that have roiled the British economy and weakened the pound since they were announced last month.
Hunt made the comments part of an emergency declaration before addressing the House of Commons later in the day.
In his speech to the House of Commons, Hunt says The government will have to make “dizzyingly difficult” decisions, but they will be based on “core compassionate conservative values”.
Early Monday, Hunter said he would Stamp duty cuts continue while National Insurance remains in place. He said he would scrap a planned 1 percent cut in the basic income tax rate, put it on hold indefinitely, and keep it at 20 percent.
He added that the energy price guarantee will no longer last for two years, but until April, after which a review will be conducted. Dividend tax cuts will be scrapped along with VAT-free shopping, a liquor tax freeze and 2021 reforms.
Hunt said “harder decisions” on taxes and spending were coming and cuts had to be made.
According to the Guardian, the chancellor said he would unveil a plan to reduce debt over the medium term on October 31.
“The reason the UK has been successful is because, in big and difficult times, we have made difficult decisions in the long-term interest of the country, and in a way that is consistent with compassionate conservative values. That’s what we’re going to do now ,” Hunter said.
During the House of Commons meeting, Labour’s Rachel Reeves said British citizens would pay a “Conservative mortgage premium” for years to come.
“I’ve shown the Conservatives can raise taxes. Will [Reeves] Show Labour’s willingness to limit spending? ‘ Hunter said in response to Reeves.
Sterling continued to rally on Monday, days after Truss dumped Chancellor Kwasi Kwarteng in favor of Hunter.
Kwarteng has put forward a “small budget” proposal that includes big tax cuts. That has thrown the UK financial sector into disarray, with the pound falling to $1.03 against the dollar last month.
On Monday morning, GBP trading price $1.13, up about 1%. A Treasury spokesman said Hunter would make a statement on his medium-term fiscal plan later on Monday.
Shanti Kelemen, chief investment officer at M&G Wealth, told BBC News: “I think you’re going to see a positive reaction to the statement, assuming the math adds up a little more than before.”
“What we saw on Friday was that the market rallied before news of Kwarteng’s resignation, but once it happened, we were sold off.”
Hunter stressed over the weekend that growing the economy remains the overarching goal, but it must be based on stability.
“The drive to grow the economy is right — it means more people can find good jobs, new businesses can flourish, and we can ensure world-class public services,” Hunter said. According to CNBC. “But we went too far, too fast.”
Shadow Treasury leader Pat McFadden said Hunt’s decision to issue an emergency declaration showed “ministers are now afraid of the market reaction” According to the Guardian.
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