Prime Minister Liz Truss is seeking to rally MPs around her tax cut policy in the wake of political infighting and market turmoil.
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LONDON. British Prime Minister Liz Truss on Wednesday said the tax cut was “the right thing to do morally and economically,” doubling down on a series of debt-financed economic reforms that have fueled internal party infighting and market turmoil.
Speaking at a Conservative Party conference, Truss said she was determined to “align our country Conservatively” in order to rally MPs around her tax cut plans and bolster her waning credibility.
“It’s morally and economically right to cut taxes,” Truss said, adding that the Conservative Party “will always be a low-tax party.”
“Tax cuts are helping to counter the global economic crisis by showing the UK is open for business,” she said in her first conference appearance as leader of the Conservative Party.
“For too long, our economy hasn’t grown as much as it should have,” she continued. “We have to raise the level of our country in a conservative way.”
“We will keep the country’s finances in an iron grip,” she said, clearly referring to her political idol Margaret Thatcher, also known as the “iron lady.” “I have three priorities for our economy: growth, growth and more growth.”
The four-day conference, held in Birmingham, England, was marked by infighting and hostility in the cabinet as longtime Tory legislators opposed the newly appointed Truss’ “growth-oriented” economic policies.
The latest uprising has centered on Truss’s resistance to higher welfare benefits in line with inflation, which is currently around 9.9% in the UK, breaking a promise made by her predecessor, Boris Johnson.
Instead of, It is reported that she plans to increase support in line with the increase in average earnings.which, taking into account bonuses, amounted to about 5.5%, according to the latest data.
Truss said the proposals would save the government billions of pounds by “helping more people find work.” But party members, including right-wingers, are warning the prime minister against cutting incomes for Britain’s poorest as the country faces its worst cost-of-living crisis in a generation.
Protesters took to the streets of Great Britain to demonstrate their dissatisfaction with the new conservative government led by Prime Minister Liz Truss.
Mike Kemp | In pictures | Getty Images
House of Commons leader Penny Mordaunt, who ran against Truss during the summer Tory leadership contest, said Tuesday she supports benefits “keeping pace with inflation,” joining a chorus of MPs who warned cuts could spark a party riot. .
Indeed, some Tories have warned that the prime minister, who has been in office for less than a month, is now fighting for his survival amid plummeting ratings.
Grant Shapps, a former transport secretary, said Tuesday that the Conservatives may can change leader again if Truss “does badly”.
On Thursday, days before the Conservative Party conference, Britain’s opposition Labor Party led the Conservative Party by 33 points. according to a YouGov poll.
However, Truss remained committed to her policy on Wednesday, saying, “Not everyone will be for change, but everyone will benefit from the outcome.”
The prime minister’s speech was interrupted by shouts from environmental protesters who were escorted out of the hall after Truss asked, “Let’s get them out.”
This follows a series of protests in Birmingham over the past week.when members of the public took to the streets to demonstrate their anger towards the government.
Reaction to tax cuts
The Truss government is torn apart over a string of debt-financed tax cuts announced last month, totaling an estimated £43bn ($49bn), that critics say benefit the wealthy and businesses disproportionately.
The prime minister herself argued that the cuts would stimulate growth in the upper strata of the economy with a domino effect on the whole society.
Amid backlash from the government on Monday was forced to abandon its plan to eliminate the 45% top income tax rate in an attempt to crack down on financial markets after the proposals sent havoc on British assets.
British Prime Minister Liz Truss has acknowledged that she should have done better to lay the groundwork for the recent “growth-oriented” tax cut that has roiled financial markets.
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Solution announcement on twitterFinance Minister Kwasi Kwarteng said “we got it and we listened,” adding that the plans had become a “distraction” due to growing backlash from both sides of the political aisle.
The tax cut — one of several supply-side reforms presented in the Sept. 23 “mini budget” — has sent financial markets into turmoil, sending the British pound to a record low of $1.0382 and 10-year yields British government bonds rose sharply. as 4.6%.
As a result, the Bank of England was forced to intervene with a plan to buy £65bn of bonds to support UK pension funds.
Since then, the pound has recovered slightly and traded at $1.1371 at 11:50 am local time, shortly after the prime minister’s speech.