In the midst of the cost of living crisis and with the country appearing to be heading towards recession, Chancellor of the Exchequer Jeremy Hunt’s presentation to Parliament will focus particularly on completing the repair of the damage caused by the previous government’s ‘mini budget’.
The previous plan included huge subsidies for energy bills and a comprehensive tax cut, and was to be funded mainly by borrowing from the markets in light of high inflation and interest rates.
The plan spread panic in the markets, which led to the pound sterling falling to its lowest level ever, while government borrowing interest rates jumped, forcing the Bank of England to intervene urgently.
“Tackling inflation is my top priority, and that guides the tough tax and spending decisions we’ll be announcing Thursday,” Hunt said after announcing a slight rise in unemployment between July and September.
This rhetoric reminds Britons of the severe austerity imposed in the aftermath of the 2008 financial crisis, which led to cuts in public services, the impact of which is still being felt, particularly in the health sector.
But Prime Minister Rishi Sunak’s government maintains that the most vulnerable will be less affected, at a time when many Britons must choose between heating and food.
“It will be a very difficult (budget) proposal because we will ask everyone to contribute more. But we will ask the people who have the most to contribute more,” Hunt told MPs on Tuesday.
He especially emphasized that the government will continue to subsidize household energy bills even after the winter season.
Pensions and grants will also be re-evaluated in line with inflation, also on the table, according to local media.
The government is seeking to collect between 50 and 60 billion pounds by increasing taxes and cutting spending, according to the same source.
It is expected to increase the amount of an exceptional tax imposed on giant energy companies and extend it until 2025, in addition to a new tax of 40 percent on electricity producers, according to what was confirmed by the “Financial Times” newspaper on Tuesday.
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