UK's Truss says she'll slash taxes despite economic crisis
U.K. Prime Minister Liz Truss said Tuesday that she’s ready to make “unpopular decisions” such as boosting bonuses for wealthy bankers in order to get the U.K.’s sluggish economy growing
NEW YORK (AP) — U.K. Prime Minister Liz Truss said Tuesday that she’s ready to make “unpopular decisions” such as boosting bonuses for wealthy bankers in order to get the country's sluggish economy growing.
Speaking before an emergency government budget statement at the end of the week, Truss said tax cuts were key to spurring economic growth, even though they benefit the wealthiest more than the poorest.
“We do have to take difficult decisions to get our economy right,” Truss said. “We have to look at all tax rates. So corporation tax needs to be competitive with other countries so that we can attract that investment.”
Truss, who has been prime minister for just two weeks, faces immediate pressure to deliver on her promises to tackle a cost-of-living crisis walloping the U.K. and an economy heading into a potentially lengthy recession.
Critics say her pro-free market, low-tax economic views, inspired by the likes of Margaret Thatcher and Ronald Reagan, is the wrong response to the crisis.
Truss, who is in New York to attend the U.N. General Assembly, confirmed the budget statement will reverse an income tax hike brought in this year to help fund health care and will scrap a plan to raise corporation tax.
She also made clear that the government will lift a cap on bankers’ bonuses imposed after the 2008 global financial crisis.
“I don’t accept this argument that cutting taxes is somehow unfair,” she told British broadcasters in interviews on the 102nd floor of the Empire State Building.
“We should be setting our tax policy on the basis of what is going to help our country become successful — what is going to deliver that economy that benefits everybody in our country. What I don’t accept is the idea that tax cuts for business don’t help people in general.”
She said the U.K. faces “incredibly tough” economic times, driven by Russia’s invasion of Ukraine, which has sent global energy prices soaring.
“What is important to me is we grow the British economy because that’s what will ultimately deliver higher wages, more investment in towns and cities across the country,” she said. “That’s what will ultimately deliver more money to people’s pockets.”
