Liz Truss was humiliated by scrapping her plan to abolish the 45p top tax rate after facing a growing insurgency from Tory MPs led by former cabinet ministers Michael Gove and Grant Shaps. I plan to make a U-turn.
After arguing early Sunday to go ahead with the controversial plan, Truss concluded after meetings with her senior team that the plan is unlikely to pass the House.
On Monday morning, Prime Minister Kwasi Kwarteng was due to confirm abandoning plans to cut taxes for Britain’s richest 1%. The 45p rate applies to earnings over £150,000.
The move is a devastating blow to the prime minister and the premier’s authority, who misunderstood the mood of the party and the country and believed they could push for tax cuts for the wealthy during a cost-of-living crisis.
The withdrawal will come on the day Qualtengue addresses the Conservative Party conference in Birmingham, and will reinforce Tory concerns that he and the Truss have lost control of government and the economy.
Mr Truss had been warned that he could lose in the House of Commons if he persisted in repealing the 45p tax rate.
Abolishing the 45p tax rate would only cost £2bn to £3bn a year, but Tory MPs saw it as a symbol of a government that seemed to be losing touch with voters.
https://www.ft.com/content/29ebdd94-8c13-48fa-8718-4c86cce902a8 Government announces U-turn on 45p tax rate