Liz Truss scraps plans to get rid of the 45% tax rate on income over £150,000 (~$168,000) after pressure from central bankers, the financial establishment and the left.
The collapse seems to indicate that Prime Minister Truss, contrary to promises, is unwilling to stand up for what she believes is right if the left, mainstream media and establishment mandarins insist she is wrong, which she may not be. good for supporters who were hoping for some semblance of change after predecessor Boris Johnson’s libertarian credentials proved to mean nothing once he was in office.
“We just talked to people, we listened to people, I understand,” Finance Minister Kwasi Kwarteng said in an appearance on BBC Breakfast.
He said the government – which Truss, perhaps reeling under pressure, accused him of at the weekend – was overturning the proposal because it had become “a huge distraction to what was a strong package” in the so-called mini-budget, which also includes cuts to the Greens levies and huge sums of money to support households and businesses during the energy crisis.
We understood and listened. pic.twitter.com/lOfwHTUo76
— Kwasi Kwarteng (@KwasiKwarteng) October 3, 2022
The shift to tax cuts, described as a “humiliating collapse for Prime Minister Liz Truss” by the decidedly less impartial BBC, comes amid outrageous claims from his peers The Financial Times that the mini-budget tax cuts made Britain’s ruling Conservatives the most financially right-wing political party in the world.
In fact, scrapping the 45 per cent tax rate would have simply returned the top rate of income tax to 40 per cent, where it remained from 1989 until the dying days of the last left-wing Labor government in 2010.
Many Tory commentators believed the government should have focused on reducing the 40 per cent tax rate on those earning between £50,000 and £150,000, which hampers the aspirations of many middle-class Britons who are not well-off enough that a sudden job loss — due illness, injury or the collapse of a business, for example — could not leave them in dire straits, the move to cut the rate by at least 45 percent seemed to signal that the status quo could change.
That seems less likely now that the establishment and its allies in the media have found that they can break the government with a concerted attack, even relatively far from a general election.
According to @ftthe UK government has the most right-wing economic policy in the developed world. pic.twitter.com/X0RVkzdgsK
— William Crawley (@williamcrawley) September 30, 2022