UK finance minister rules out near-term tax reductions

FILE PHOTO: Britain's Chancellor of the Exchequer Jeremy Hunt walks at Downing Street in London, Britain, November 17, 2022. REUTERS/Toby Melville/

LONDON: Britain’s finance minister Jeremy Hunt ruled out near-term tax cuts ahead of a mid-year fiscal statement due on Nov 22, but says in a newspaper interview he wants to avoid “a vicious circle of ever-rising taxes”.

Many lawmakers in Britain’s ruling Conservatives want Hunt to deliver tax cuts before the next election, as their party heavily trails the opposition Labour Party in opinion polls.

“We’re not in a position to talk about tax cuts at all,” Hunt said in an interview with The Times newspaper, ahead of his Conservative Party’s annual conference, which started yesterday.

Throughout this year, Hunt has said his priority is to support Prime Minister Rishi Sunak’s goal to halve inflation, rather than lower taxes, and in a Bloomberg TV interview earlier this month he said tax cuts were “unlikely”.

“The question we have to answer for the British people is: what are you doing to get yourself in a position where you can credibly lower taxes?”, Hunt told The Times.

Last Friday, the Institute for Fiscal Studies, a non-partisan think tank, said tax revenue was likely to represent 37% of annual economic output at the time of the next election expected in 2024, up from 33% in 2019 when the Conservatives last won an election, under then-Prime Minister Boris Johnson.

This would be Britain’s highest tax rate since at least the 1950s, although below most other similar European economies. — Reuters

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