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Kwasi Kwarteng returns home early from the US amid tax U-turn chaos.politics

Kwasi Kwarteng cut his trip to the International Monetary Fund much shorter and returned home early from Washington in response to the growing political crisis over the tax cut budget.

In addition to signs the government is preparing to announce a U-turn over plans to repeal the corporate tax hike, the prime minister left the US capital a day ahead of schedule.

Finance sources said the prime minister had spent two constructive days in Washington, but was eager to return to London to discuss with colleagues the medium-term financial plan to be announced on October 31.

But his unscheduled departure on a late-night flight from Washington capped a day of drama for the Truss administration, prompting comparisons to the sterling crisis suffered by the Labor government in 1976.

Prime Minister Dennis Healy then turned back at Heathrow rather than fly out for the IMF meeting in Manila after pressure on the pound increased.

Finance sources declined to comment on whether Kwarteng’s decision meant a corporate tax U-turn was imminent, but the prime minister pressured the financial markets to make a decision before opening for business on Monday. had received

Pounds and government bonds, or gold coins, rose yesterday after rumors of a change of heart over taxes. However, the Bank of England’s bond support package ends on Friday.

A finance source said, “This is all about the medium-term financial plan.” “The prime minister wanted to involve the widest possible range of colleagues.”

Prior to this, Mr. Kwarteng was forced to deny his position as the prime minister was in danger despite the growing Tory rebellion.

But yesterday there were signs that tax decisions were being made by Liz Truss in London, not by the Prime Minister 3,000 miles across the Atlantic.

On another frenzied day in Westminster, government sources told The Guardian that the 10th official, not the Treasury counterpart, was reviewing the mini-budget in the prime minister’s effort to balance the books. rice field.

The Truss has repeatedly pledged to back out of former Prime Minister Rishi Snak’s plan to raise the corporate tax from 19% to 25%. Sources suggest that the potential uptick could include just a 1-2 percent rise, rather than the full 6 percent.

https://www.theguardian.com/politics/2022/oct/14/kwasi-kwarteng-dashes-home-early-from-us-amid-tax-u-turn-chaos Kwasi Kwarteng returns home early from the US amid tax U-turn chaos.politics

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