U.K. scraps tax cut for wealthy that sparked market turmoil

In a dramatic about-face, Treasury chief Kwasi Kwarteng abandoned plans to scrap the top 45% rate of income tax paid on earnings above 150,000 pounds a year.Start your day with a roundup of B.C.-focused news and opinion delivered straight to your inbox at 7 a.m., Monday to Friday.By clicking on the sign up button you consent to receive the above newsletter from Postmedia Network Inc. You may unsubscribe any time by clicking on the unsubscribe link at the bottom of our emails.

The U-turn came after a growing number of Conservative lawmakers, including former ministers with broad influence, turned on the government’s tax plans.Article contenttap here to see other videos from our team“I can’t support the 45p tax removal when nurses are struggling to pay their bills,” Tory lawmaker Maria Caulfield said.

She also said the decision to abolish the top tax rate had been taken by Kwarteng alone. On Monday, Truss’ spokesman said the prime minister still had confidence in her embattled Treasury chief. Truss and Kwarteng insist that their plan will deliver a growing economy and eventually bring in more tax revenue, offsetting the cost of borrowing to fund the current cuts. But they also have signaled that public spending will need to be slashed to keep government debt under control.Article content

Kwarteng has promised to set out a medium-term fiscal plan on Nov. 23, alongside an economic forecast from the independent Office for Budget Responsibility.

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