'Fighter, not a quitter': UK PM Liz Truss stands defiant as MPs boo her over tax cuts

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'Fighter, not a quitter': UK PM Liz Truss stands defiant as MPs boo her over tax cuts
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UK PM Liz Truss was at the receiving end of a sharp attack by UK’s labour party over her ‘disastrous tax-cut policy’ that send the Pound spiralling to a record low against the US Dollar.

A video grab taken from footage broadcast by the UK Parliament’s Parliamentary Recording Unit (PRU) shows Britain’s Prime Minister Liz Truss speaking during Prime Minister’s Questions in the House of Commons in London on October 19, 2022. Truss was addressing lawmakers in parliament for the first time since abandoning her disastrous tax-slashing economic policies. (AFP)

By Abhishek Chakraborty: Questioned over her tax-slashing policy amid a weakening economy, British Prime Minister Liz Truss on Wednesday said she would not quit. She was speaking in the House of Commons, the lower house of the British Parliament, amid boos from Labour MPs in the Opposition.

This was her first Question Time session since she withdrew the “disastrous tax-slashing economic measures”. Labour leader Keir Starmer said: “What’s the point of a Prime Minister whose promises don’t last even a week?”

ALSO READ | ‘Wanted to help people with taxes, but…’: UK PM Liz Truss apologises for mini-budget ‘mistakes’

Starmer led his MPs in chants of “Gone, gone!” as he read out a list of her dropped policies, mocking Truss. “Why is she still here?” he concluded.

However, an unabashed Truss replied: “I am a fighter and not a quitter. I am someone who is prepared to front up. I’m prepared to take the tough decisions. I have acted in the national interest to make sure that we have economic stability.”

WHAT WAS IN THE ‘TRUSSONOMICS’ POLICY?

The major measures in the tax-cut policy announced by Liz Truss on September 23 included:

  • Scrapping of a proposed tax hike to 25% for corporations and bringing it down to 19% instead. This is the lowest tax rate among the G-20 nations.
  • Bringing down the basic rate of income tax from 20 pence to 19 pence.
  • Removal of the 45% tax paid on income over £150,000 ($166,770). This took the top rate to 40%.
  • Reversal of the 1.25% rise in national insurance contributions.
  • Major reductions in taxes paid on home purchases.
  • Introduction of tax-cut zones where there would be fewer regulatory obstacles and more liberalised planning rules.
  • Introduction of a scheme that would enable tourists to claim sales taxes paid by them
  • Reversal of tax hikes on alcohol.
  • Removal of cap on bankers’ bonuses.

Liz Truss’s infamous tax cuts, which had to be rolled back within a month, sent the Pound spiralling to a record low against the US Dollar. Had the policy of unfunded tax cuts, being called “Trussonomics”, been implemented in full, it would have cost the UK $48 billion worth of taxes.

ALSO READ | Will Liz Truss outlast a lettuce? UK PM becomes the butt of jokes in tabloids

The £45 billion tax-cut package sent the markets into a tizzy and sparked widespread selling, prompting the Bank of England to step in and buy government debt worth £65 billion to stop some of the pension funds in the country from collapsing.

However, Liz Truss continued to insist that the tax cuts outlined in the ‘mini-budget’ were the “right plan”. In less than a month of the announcement of the policy, the Chancellor of the Exchequer, Kwasi Kwarteng, was sacked and Jeremy Hunt was appointed the new finance chief.

A video grab taken from footage broadcast by the UK Parliament’s Parliamentary Recording Unit (PRU) shows Britain’s Prime Minister Liz Truss (L) grimacing next to Britain’s Chancellor of the Exchequer Jeremy Hunt as the opposition Labour Party addresses her during Prime Minister’s Questions in the House of Commons in London on October 19, 2022. (AFP)

Right after his appointment, Hunt reversed nearly all of the tax cuts announced by Truss last month, causing massive embarrassment to the British PM. Wednesday’s session at the House of Commons was held less than 48 hours after the reversal of the tax plans. He sat by her side in Parliament, nodding along to her responses. “We have delivered on the energy price guarantee. We delivered on national insurance. We are going to stop the militant trade unions,” Truss fired back at Starmer.

Truss lambasted Truss for what he claimed was “an economic experiment on the British public”. Mocking Truss further, he said: “How could she be held to account when she’s not in charge?”

ALSO READ | Most Tory members want Liz Truss gone, poll shows 55% would vote for Rishi Sunak as UK PM

Opposition parties are now demanding Truss’s resignation and an immediate general election, which is not due for two years. “Will she do the decent thing and go and call a general election?” Labour MP Sarah Owen asked in Parliament.

Under current party rules, Truss cannot be challenged by a no-confidence vote in her first year, but speculation is rife that the rules could be changed to allow for a ballot.

(With inputs from AFP, BBC, and CNBC)





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