Support 100 years of independent journalism.

  1. Politics
  2. UK Politics
20 October 2022

Was Liz Truss’s mini-Budget the point of no return?

More than £30bn of the £45bn of tax cuts originally announced were quickly abandoned. Less than a week later, Truss announced her resignation.

By Katharine Swindells

Earlier this month, in an effort to calm the markets and prevent her eventual downfall, Liz Truss sacked Kwasi Kwarteng as chancellor and replaced him with Jeremy Hunt. A few days later, Hunt announced a series of dramatic U-turns on economic policy.

The new chancellor revealed that the government would abandon most of the measures from the “mini-Budget” set out by Kwarteng the previous month, including the proposed cut in the basic rate of income tax, the cut to dividends tax, the repeal of the off-payroll working rules, and the proposed new VAT-free shopping scheme. He also announced that the government’s energy support scheme would be scaled back from next April.


Hunt’s revisions followed the other U-turns that Truss and Kwarteng had already announced: the retention of the 45p income tax rate and a rise in corporation tax from 19 per cent to 25 per cent, which by 2027 will raise more than £18.7bn per year.

Before long, the government had reversed more than £32bn of its initial proposed tax cuts of £45bn. Among the measures that have survived are the reversal of the National Insurance increase (projected to cost the government around £18bn per year) and the cut in stamp duty, though it remains to be seen what policies are left standing once a new PM is in post.

[See also: Liz Truss resigns as Prime Minister after just 44 days]

Select and enter your email address Quick and essential guide to domestic and global politics from the New Statesman's politics team. A weekly newsletter helping you fit together the pieces of the global economic slowdown. The New Statesman’s global affairs newsletter, every Monday and Friday. The New Statesman’s weekly environment email on the politics, business and culture of the climate and nature crises - in your inbox every Thursday. Our weekly culture newsletter – from books and art to pop culture and memes – sent every Friday. A weekly round-up of some of the best articles featured in the most recent issue of the New Statesman, sent each Saturday. A newsletter showcasing the finest writing from the ideas section and the NS archive, covering political ideas, philosophy, criticism and intellectual history - sent every Wednesday. Sign up to receive information regarding NS events, subscription offers & product updates.
  • Administration / Office
  • Arts and Culture
  • Board Member
  • Business / Corporate Services
  • Client / Customer Services
  • Communications
  • Construction, Works, Engineering
  • Education, Curriculum and Teaching
  • Environment, Conservation and NRM
  • Facility / Grounds Management and Maintenance
  • Finance Management
  • Health - Medical and Nursing Management
  • HR, Training and Organisational Development
  • Information and Communications Technology
  • Information Services, Statistics, Records, Archives
  • Infrastructure Management - Transport, Utilities
  • Legal Officers and Practitioners
  • Librarians and Library Management
  • Management
  • Marketing
  • OH&S, Risk Management
  • Operations Management
  • Planning, Policy, Strategy
  • Printing, Design, Publishing, Web
  • Projects, Programs and Advisors
  • Property, Assets and Fleet Management
  • Public Relations and Media
  • Purchasing and Procurement
  • Quality Management
  • Science and Technical Research and Development
  • Security and Law Enforcement
  • Service Delivery
  • Sport and Recreation
  • Travel, Accommodation, Tourism
  • Wellbeing, Community / Social Services
Visit our privacy Policy for more information about our services, how New Statesman Media Group may use, process and share your personal data, including information on your rights in respect of your personal data and how you can unsubscribe from future marketing communications.
THANK YOU

Content from our partners
What are the green skills of the future?
A global hub for content producers, gaming and entertainment companies in Abu Dhabi
Insurance: finding sustainable growth in stormy markets

Topics in this article: , ,