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Britain’s new finance minister Jeremy Hunt said on Saturday some taxes would go up and tough spending decisions were needed, saying Prime Minister Liz Truss had made mistakes as she battles to keep her job just over a month into her term.

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She has now ditched plans to cut tax for high earners, and said a levy on business would increase, abandoning her proposal to keep it at current levels. But a slump in bond prices after her news conference on Friday suggested she had not gone far enough. Hunt is due to announce the government’s medium-term budget plans on October 31, in what will be a key test of its ability to show it can restore its economic policy credibility.

Kwarteng’s September 23 fiscal statement prompted a backlash in financial markets that was so ferocious the BoE had to intervene to prevent pension funds being caught up in the chaos as borrowing costs surged.Hunt, an experienced minister and viewed by many in his party as a safe pair of hands, said he agreed with Truss’s fundamental strategy of kickstarting economic growth, but he added that their approach had not worked.

 

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