'More tax cuts to come' in the next year, says Kwasi Kwarteng

Kwasi Kwarteng - Dylan Martinez/Reuters/Pool/File Photo
Kwasi Kwarteng - Dylan Martinez/Reuters/Pool/File Photo

Kwasi Kwarteng has promised there are “more tax cuts to come” in the next year in the wake of his historic ‘mini-Budget’ this week.

The Chancellor gambled on the biggest tax cuts in half a century on Friday, setting out a £45billion package he hopes will stave off a recession.

Measures unveiled by Mr Kwarteng included cutting income tax, National Insurance and stamp duty.

The Telegraph reported on Saturday night that he and Liz Truss are also considering changes to child benefits, income tax and savings.

Speaking to the BBC’s Sunday with Laura Kuenssberg programme, Mr Kwarteng appeared to confirm there would be further measures to reduce the tax burden for Britons.

“There is more to come – we have only been here for 19 days,” he said. “I want to see, over the next year, people retain more of their money.”

Defending his decision to impose tax cuts during a cost-of-living crisis amid criticism from Labour and Left-wing commentators, the Chancellor added: “In terms of our approach, there was no way that we were going to get more growth by simply increasing taxes and taking more of people's money.

“And that was the response that the Prime Minister and I debated. We talked about it and we thought we've got to change tack.”

Mr Kwarteng’s approach marks a step change from the previous Boris Johnson government that had planned to raise corporation tax and in April oversaw an increase in National Insurance, which was reversed by Mr Kwarteng on Friday.

He insisted he was “confident” the Bank of England was “dealing with” rising levels of inflation, and went on to attack the “perverse” logic of tax rises.

Asked about Government plans to borrow in order to fund his package of measures, Mr Kwarteng cited the response to the pandemic and Vladimir Putin’s invasion of Ukraine.

“All I would say on borrowing is that we’ve managed to respond to what they call two exogenous shocks, two things that were not in our control and were of unprecedented scale.

“And that was the right thing to do. Obviously I will be setting out plans for the medium-term fiscal plan, as we’re calling it.

“What I'm not going to do, Laura, is to say that if there is an exogenous extreme event, I can't possibly say that we won't borrow to deal with that. And that's what we've done. That's why we have borrowed in the way we have.”