UK

Truss admits her tax cuts will disproportionately benefit the rich – and says she’s prepared to be an unpopular PM to boost economy

Liz Truss has said she is prepared to be unpopular with her tax policy as she believes it will ultimately benefit the British economy.

Talking to Sky News’ political editor Beth Rigby in New York, the prime minister defended any tax changes her government will make at the end of the week and said she will do what she has to do to get the economy growing again.

She also dismissed concerns around government plans to borrow more instead of taxing energy companies’ profits (a windfall tax) and said she does not accept cutting taxes is unfair.

Cost of living crisis: Major tax announcement this week – follow live

Asked if she was prepared to be unpopular with her policies, Ms Truss said: “Yes, yes I am.

“What is important to me is that we grow the British economy, because that is what will ultimately deliver higher wages, more investment in towns and cities across the country, that is what will ultimately deliver more money into people’s pockets, and it will also enable us to fund the services like the National Health Service.

“And in order to get that economic growth, Britain has to be competitive.”

More on Cost Of Living

She said putting up taxes, placing “arbitrary taxes” on energy companies or having high corporation tax would result in a lack of investment and growth which she said “will ultimately damage opportunities in this country”.

Ms Truss defended reports that Chancellor Kwasi Kwarteng will scrap caps on bankers’ bonuses during a mini budget announcement on Friday as she blamed the UK’s “relatively low growth” on a lack of capital investment.

“We haven’t had enough capital investment and yet we have one of the world’s best financial services centres,” she said.

“So what I want to see is that money in the City of London put to good use across our country – and yes, I’m prepared to do what it takes to get that money flowing.”

British Prime Minister Liz Truss looks on as she speaks to the media at the Empire State building in New York, U.S., September 20, 2022. REUTERS/Toby Melville/Pool
Image:
Liz Truss spoke to Beth Rigby at the Empire State Building before meeting world leaders at the UN General Assembly

Read more:
Truss promises UK will not ration energy – but higher bills are worth it to stand up to Russia
Spending more on military aid to Ukraine will cut energy bills, minister says

As she further laid the path for the bankers’ bonus announcement and tax-cutting, the PM admitted her tax cuts would disproportionately benefit the rich.

“I don’t accept this argument that cutting taxes is somehow unfair,” she said.

“I mean, what we know is that people on higher incomes generally pay more tax.

“So when you reduce taxes, there is often a disproportionate benefit because those people are paying more taxes in the first place.

“We should be setting our tax policy on the basis of what is going to make our country most successful, what is going to deliver that economy that benefits everyone in this country.”

While the prime minister remained bullish about her tax policies, she did admit it will be a “tough winter”.

But she added: “I’m determined my government takes every step and strains every sinew to get the economy going, to make sure we have a successful economy and as a country we can weather this storm.

“We will get through it.”

Earlier in the day, the PM promised the UK would not bring in energy rationing this winter as some countries, such as Germany, have done.

She said the UK – and the West – “cannot jeopardise our security for the sake of cheap energy” as she pushed for other countries to commit to continue supporting Ukraine after announcing the UK will match the more than £2.3bn military aid it provided this year.

Articles You May Like

‘India has a big role to play’: New Delhi is trying to turn the country into a chip powerhouse
Fraudster ‘made $1m by impersonating Hollywood bosses’
Pound falls to 37-year low as cost of servicing government debt hits August record
Biden to tell Truss ‘in some detail’ that UK must negotiate with EU over Northern Ireland
Chris Kaba’s family speak out after being shown bodycam footage of police shooting him dead