British Finance Minister Jeremy Hunt on Thursday unveiled an austerity budget to fix Britain's finances with 55 billion pounds in tax hikes and public spending cuts, despite the country having already entered recession. .
"
It's a balanced stability plan
", "
I tried to be fair by asking those who have more to contribute more
", argued Jeremy Hunt, in a sober tone, before Parliament.
“
The UK, like other countries, is now in recession
” according to the OBR, the public budget forecasting body, argued Jeremy Hunt and its gross domestic product (GDP) will fall by a further 1.4 % in 2023. He unveiled “
three priorities: stability, growth and public services
”.
Stability, after the financial turmoil of the previous government, tops the list, and with it the fight against inflation "
which affects the poorest the most
".
Read alsoThe United Kingdom is “in recession”, the GDP will decrease by 1.4% in 2023
According to him, the OBR has “
confirmed that global factors are the main cause of inflation, while most countries are still dealing with the fallout
” from the Covid pandemic, which has been aggravated by “
the energy crisis generated by Russia
” and its invasion of Ukraine.
Listing a package of fiscal '
consolidation
' measures totaling £55bn, he mentioned lowering the top income tax threshold, and raising the tax on windfall giants' earnings. oil and energy, boosted by the energy boom and the war in Ukraine.
Impact of Brexit
The new finance minister had the daunting task of reassuring markets chafed by the massive and ill-prepared budget announcements of former Prime Minister Liz Truss, which sent UK markets rocking and the cost of the country's debt skyrocketing.
The minister was careful to rely on figures from the OBR, the absence of which during the disastrous “
mini-budget
” of the previous government had contributed to causing a panic in the markets.
Jeremy Hunt has already erased most of the measures that were then announced by the ephemeral Liz Truss who wanted to proceed with massive energy aid and all-out tax cuts.
Read alsoUnited Kingdom: inflation accelerates further, to 11.1% in October
The hard-to-swallow tax potion for Britons comes as the economy has already contracted by 0.2% of gross domestic product in the third quarter.
The recession that is beginning could last up to two years according to the Bank of England, even if for this year the OBR predicts growth of 4.2%.
In addition to Covid and the war in Ukraine, the United Kingdom is suffering from the impact of Brexit, which is hampering trade with its large European neighbor and hampering the hiring of workers from the continent, which is contributing to inflation and the loss of productivity.
London will increase its exceptional tax on the profits of energy giants from 25% to 35%, and will extend it for three years, until 2028 and Jeremy Hunt also announced "
a new temporary tax of 45% on electricity producers
".
