New Chancellor’s Emergency Statement
They say a week is a long time in politics but at the moment a day seems like a very long time with changes happening at breakneck speed. The newly appointed Chancellor Jeremy Hunt has today reversed most of the measures introduced by his predecessor Kwasi Kwarteng a matter of weeks ago.
The only tax measures which remain in place are those which have already been put in place – including the reverse to the recent rise in National Insurance and a cut to stamp duty.
The pledge to cut the basic rate of income tax to 19% has been scrapped – it will remain indefinitely at 20%. Corporation tax will rise to 25% from April 2023.
Other tax cuts unveiled by Mr Kwarteng, including to dividend taxes, payrolls, as well as a new VAT-free shopping scheme and a freeze on some alcohol duties will be scrapped.
The flagship policy of a promised two-year energy price cap has also now gone – with support now promised until April 2023 to cover just this winter. After that period it will be targeted to the most vulnerable households.
Mr Hunt said his measures would bring stability and the pound rose following Mr Hunt’s announcement. He will set our further measures in Parliament on October 31st.
What we’ve seen today is the death of Trussanomics – and questions over her ability to remain as Prime Minister grow ever louder.
