Embarrassing government U-turn on tax cut for wealthiest
The controversial mini-Budget has stirred up the press and led to some dramatic headlines, government u-turns and finger-pointing.
Amid fears of a Tory MP rebellion over the plan to abolish the 45p tax rate -unveiled in last Friday’s mini-budget, the government have made a dramatic u-turn.
The measure sparked market turmoil and caused the value of the pound to plummet. Now the papers are looking at how damaging the government u-turn will be too Liz Truss’s premiership.
One paper is leading with claims she’ll be ousted by Christmas, other publications are pointing the finger at rebels within the party and the Guardian is enjoying Twitter’s reaction to the dramatic u-turn.
What was the plan?
Last Friday, chancellor Kwasi Kwarteng unveiled his mini-Budget and the measure to abolish the 45p tax rate caused turmoil and backlash.
After a weekend of headlines, panic and backlash the government has now abandoned its plan to abolish the top rate of income tax for the highest earners – a u-turn that has been seen as embarrassing for Liz Truss and her government.
The plan was unveiled in the mini-Budget – a series of economic policies unveiled by the chancellor, who said: “it is clear that the abolition of the 45p tax rate has become a distraction.” Chancellor Kwasi Kwarteng is said to have been disappointed that the package he unveiled – including the cost of living support has been widely ignored due to one controversial measure. “We get it, and we have listened,” the Chancellor added when discussing the U-turn.
Divisive Truss mini-budget Attacked by the Conservative party in Birmingham
The embarrassing U-turn from PM and Chancellor
The U-turn came after Tory MPs voiced their opposition to the plan. There appeared to be a growing Tory MP rebellion and fears they would not get enough votes to pass the measure.
Only yesterday, prime minister Liz Truss said at the Conservative Party conference she would not abandon the policy. Monday’s front pages had a field day with the growing rebellion, the outrage.
But by Monday morning – the government announced its U-turn and says the chancellor and PM agreed together they should scrap the tax cut.
The chancellor said, following the U-turn, that the government can now “move forward with making the push for the growth plan.” The chancellor also made it clear he had no intention to resign following the embarrassing U-turn.
The reaction – ‘Imagine losing £65bn and keeping your job’
Understandably, the left-wing papers did not react well to the proposal to scrap the rate paid by people earning over £150,000 a year – which had been criticised as unfair amid the cost of living crisis.
The Guardian takes delight in Twitter’s reaction to the U-turn saying the first mini-budget hasn’t gone down well – noting “resign” trended on Twitter within her first month in office. Whilst the Independent notes how quickly the U-turn came about and dismissed claims that Truss was “the reincarnation of Margaret Thatcher.”
The Daily Express – a pro-Conservative tabloid, points the finger and lays blame on Michael Gove, saying he has “launched a fresh attack on Truss,” whilst the Sun tells Tory MPs to calm down and get behind the prime minister.
Monday’s newspapers react
Before Monday morning’s shock announcement, the papers had already published their front pages. Here’s how Monday’s newspapers reported on the Tory MP rebellion over the proposal and the mini-Budget.
Tory-favourite the Daily Telegraph says the PM is to delay a vote on scrapping the top rate of tax after Michael Gove added his voice to the criticisms – calling it “not Conservative.”
The Daily Mail’s front page reports on the “mounting Tory revolt” and questions whether the PM could be on the brink of a u-turn. The paper says the tax cut could be ditched by No 10 in hopes to shore up support for the rest of the mini-budget measures.
The Times uses its front page to highlight criticism of the prime minister from Grant Shapps. The former Transport Secretary said the government should not be making “big giveaways to those who need them least.” He says cutting the top rate of tax is a “tin-eared” move that has managed to alienate almost everyone.
The Daily Express says the chancellor will draw a line under the market turmoil when he issues a “conference battle cry” this afternoon – at the Tory party conference in Birmingham. He is expected to say the government “must stay the course” as watered-down alternatives would leave Britain on a path of “managed decline.”
The Financial Times also previewed Mr Kwarteng’s speech which reports that the chancellor will insist he is confident his plan is the “right one.” The paper uses its editorial to argue he is wrong and slam the “disastrous” mini-budget.
The Guardian says there is a “rising drumbeat of discontent” overshadowing the conference as some MPs threaten a full-scale rebellion amid fears they will become known as the “nasty party.”
A former cabinet minister spoke to the Daily Mirror and said PM Liz Truss has lost all credibility and will be ousted as PM by Christmas unless she abandons her tax cuts for the wealthy.