Scrap 45p tax

Kwasi Kwarteng is facing a mounting rebellion in the ruling Conservative party over his plan to scrap the 45p top rate of income tax but will tell party members today that he is «confident» the plan is «the right one». The UK chancellor’s tax-cutting «mini» Budget, which also included a massive wave of new government borrowing, created turmoil in the markets last week and left him scrambling to prove that he could get a grip on debt.

Truss admitted that mistakes were made in the «mini» Budget that sparked market turmoil last week but said she would not retreat on her plan to deliver £45bn of unfunded tax cuts, insisting it would help deliver growth. However, the PM repeatedly refused to say whether she would cut public spending to make the sums add up and said she needed to work to win «the hearts and minds» of Tory MPs to convince them her plan was right. Some Conservative MPs have already started speculating on the possibility that Truss could be replaced by her leadership rival, Rishi Sunak, who is spending conference week in his North Yorkshire constituency.

www.sba.tax

Comments

Cloud Bookkeeping

US FED rate rise.

The US Federal Reserve officials have indicated that they plan to resume increasing interest rates to control inflation in the world's biggest economy. During the June meeting, the Federal Open Market Committee reached a consensus to keep interest rates stable for the time being to evaluate whether further tightening of policy would be necessary. However, the majority of the committee anticipates that additional rate increases will be required in the future. The minutes of the meeting have recently been made public. According to the minutes, most participants believed maintaining the federal funds rate at 5 to 5.25 per cent was appropriate or acceptable, despite some individuals wanting to raise the acceleration due to slow progress in cooling inflation. Although Fed forecasts predicted a mild recession starting later in the year, policymakers faced challenges in interpreting data that showed a tight job market and only slight improvements in inflation. Additionally, officials gr...

EU business slide.

S&P Global’s flash eurozone composite purchasing managers’ index, a key gauge of business conditions for the manufacturing and services sector, fell 1 point to 47.1, figures showed yesterday. That is its lowest level since November 2020 and the fourth consecutive month below the crucial 50 mark separating growth from contraction. One of the few bright spots in the survey was that companies in all sectors reported a slight easing of cost pressures, price growth and supply chain constraints. However, prices charged for goods and services still rose at the sixth fastest rate since such data started in 2002. Jobs growth increased marginally from October but remained low compared with the past 18 months. Following a few months of falling price pressure in manufacturing and services, the October print shows an overall stabilisation said Jens Eisenschmidt, chief European economist at Morgan Stanley. However, German businesses, at the hub of Europe’s energy crisis, reported that manu...

EU debt reduction

Brussels wants to give EU capitals extra time to curb their debts and create space for public investment as part of an overhaul of the EU’s deficit rules . The European Commission would table a proposal at the end of the month to reform the Stability and Growth Pact , under which it would work out multi-year , country-specific plans with capitals for getting their debt burdens under control , EU officials said . The proposals come as member states face mounting fiscal burdens as they spend hundreds of billions of euros sheltering businesses and households from the energy crisis . Under the new blueprint , the commission would propose a four- or five-year plan to an EU member state to get its public debt burden on a credible , downward trajectory , officials said . The national fiscal plan would need to pass a debt sustainability analysis and be approved by the commission and EU council . The new regime would ditch an EU ...

Search This Blog