The UK government is making significant spending cuts. The country is making cuts of more than 30 billion pounds (34 billion euros) and is also increasing taxes by about 24 billion pounds.
British Finance Minister Jeremy Hunt and newly appointed Prime Minister Rishi Sunak must restore the confidence of financial markets in the British government.
Liz Truss, Sunak’s predecessor, introduced plans in September, but they caused a lot of disruption. The Bank of England had to intervene several times to prevent major problems and Truss was forced to leave the field after a few weeks. Her plans were reversed.
Hunt’s plans, which have just begun, mean, among other things, higher taxes on middle income and energy companies. The minimum for the highest income tax bracket will be reduced.
Furthermore, the British government wants to impose more taxes on dividend income. This decision was striking, because Shell and Unilever recently decided to become fully British. More favorable dividend rules in the UK may have played a role.
In addition to higher taxes, there will also be £30 billion in cuts. The National Health Service, the National Health Service, remains out of harm’s way.
The United Kingdom also suffers from high inflation rates. For example, it was announced on Wednesday that goods and services were on average 11 percent more expensive in October than a year earlier. This is the highest level in more than forty years. According to Hunt and Sunak, tackling high inflation is the top priority.
