London Daily

Focus on the big picture.
Monday, Sep 01, 2025

Jeremy Hunt reverses 'almost all' tax cuts in mini-budget and says energy bills support scheme to be scaled back

Jeremy Hunt reverses 'almost all' tax cuts in mini-budget and says energy bills support scheme to be scaled back

The new chancellor said he was making further changes to the mini-budget to "reduce unhelpful speculation" about what was happening with the government's growth plan ahead of the medium-term fiscal plan on Halloween.

Jeremy Hunt has revealed he is reversing "almost all" of the tax cuts announced in his predecessor's mini-budget and is scaling back support for energy bills.

In an emergency statement, the chancellor said a 1p cut to income tax will be delayed "indefinitely" until the UK's finances improve instead of being introduced in April 2023 as announced in Kwasi Kwarteng's mini-budget three weeks ago.

Mr Hunt, who only stepped into the job on Friday, said the government's energy price guarantee will only be universal until April - not for two years as originally planned.

After April, the scheme will be more targeted following a review into how to support people's energy bills from that time, he said.

"The government has today decided to make further changes to the mini-budget, and to reduce unhelpful speculation about what they are, we've decided to announce these ahead of the medium-term fiscal plan, which happens in two weeks," Mr Hunt said.

He said the government was reversing "almost all" the tax measures announced in the mini-budget that have not yet started going through parliament.

The Treasury said new tax measures would bring in £32bn after economists estimated the government was facing a £60bn black hole in public finances with the mini-budget announcements.

The changes Mr Hunt revealed include:

*  No cuts to dividend tax rates

*  Repeal of the easing of IR35 rules for the self-employed introduced in 2017 and 2021

*  No new VAT-free shopping scheme for overseas visitors to the UK

*  No freeze on alcohol duty rates

*  Basic rate of income tax to remain at 20%, not reduce to 19% from April 2023

*  Energy price guarantee only until April 2023.


'A new approach'


Mr Hunt promised: "The objective is to design a new approach that will cost the taxpayer significantly less than planned, whilst ensuring enough support for those in need.

"Any support for businesses will be targeted to those most affected, and the new approach will better incentivise energy efficiency.

"The most important objective for our country right now is stability."

As Mr Hunt revealed the tax cut reversals, the pound strengthened by more than 1.2% to 1.139 against the US dollar and UK government bonds rallied further, with yields on 30-year gilts easing back by around 10%.

Widely seen as the most powerful person in government now, Mr Hunt added that there will be "more difficult decisions" on tax and spending" and said all government departments "will need to redouble their efforts to find savings, and some areas of spending will need to be cut".


The mini-budget tax cuts that will not be reversed, as they are already going through parliament, are: reversing the increase in national insurance contributions and the stamp duty cut.

Ms Truss' spokesman said Monday's decision was taken jointly by the PM and Mr Hunt over the weekend and again admitted the mini-budget went "too far, too fast".

But he sidestepped questions about whether Ms Truss would resign after another Tory, Angela Richardson, joined those who started publicly calling for her to go over the weekend.

'Genuinely shocking'


Sky News' political editor Beth Rigby said this row back on the mini-budget is a major blow for Liz Truss, just six weeks into her premiership.

"The entire platform of the Truss administration is gone, is gone. It's done," she said.

"It's genuinely shocking in terms of how a prime minister and her cabinet got this so wrong and had to reverse in such a dramatic way."

"It's not just the tax decisions in the mini-budget that the new chancellor now says are just not viable.

"He's now saying that the policy platform, her big shock and awe announcement as it was billed in the run-up to that announcement is also just economic, not viable. And that is another body blow to the prime minister today."

'Still flying blind'


Scottish First Minister Nicola Sturgeon used a news conference about Scottish independence shortly after Mr Hunt's statement to say the government turmoil is "a self-inflicted crisis for Liz Truss" and "is humiliating in quite an unprecedented way".

"I think the sooner this prime minister and this entire government departs office, the better that will be for everyone," she added.

Newsletter

Related Articles

0:00
0:00
Close
Chinese and Indian Leaders Pursue Amity Amid Global Shifts
European Union Plans for Ukraine Deployment
ECB Warns Against Inflation Complacency
Concerns Over North Cyprus Casino Development
Shipping Companies Look Beyond Chinese Finance
Rural Exodus Fueling European Wildfires
China Hosts Major Security Meeting
Chinese Police Successfully Recover Family's Savings from Livestream Purchases
Germany Marks a Decade Since Migrant Wave with Divisions, Success Stories, and Political Shifts
Liverpool Defeat Arsenal 1–0 with Szoboszlai Free-Kick to Stay Top of Premier League
Prince Harry and King Charles to Meet in First Reunion After 20 Months
Chinese Stock Market Rally Fueled by Domestic Investors
Israeli Airstrike in Yemen Kills Houthi Prime Minister
Ukrainian Nationalist Politician Andriy Parubiy Assassinated in Lviv
Corporate America Cuts Middle Management as Bosses Take On Triple the Workload
Parents Sue OpenAI After Teen’s Death, Alleging ChatGPT Encouraged Suicide
Amazon Faces Lawsuit Over 'Buy' Label on Digital Streaming Content
Federal Reserve Independence Questioned Amid Trump’s Push to Reshape Central Bank
British Politics Faces Tumultuous Autumn After Summer of Rebellions and Rising Farage Momentum
US Appeals Court Rules Against Most Trump-Era Tariffs
UK Sought Broad Access to Apple Users’ Data, Court Filing Reveals
UK Bank Shares Dive Over Potential Tax on Sector
Germany’s Auto Industry Sheds 51,500 Jobs in First Half of 2025 Amid Deepening Crisis
Bruce Willis Relocated Due to Advanced Dementia
French and Korean Nuclear Majors Clash As EU Launches Foreign Subsidy Probe
EU Stands Firm on Digital Rules as Trump Warns of Retaliation
Getting Ready for the 3rd Time in Its History, Germany Approves Voluntary Military Service for Teenagers
Argentine President Javier Milei Evacuated After Stones Thrown During Campaign Event
Denmark Confronts U.S. Diplomat Over Covert Trump-Linked Influence in Greenland
Starmer Should Back Away from ECHR, Says Jack Straw
Trump Demands RICO Charges Against George Soros and Son for Funding Violent Protests
Taylor Swift Announces Engagement to NFL Star Travis Kelce
France May Need IMF Bailout, Warns Finance Minister
Chinese AI Chipmaker Cambricon Posts Record Profit as Beijing Pushes Pivot from Nvidia
After the Shock of Defeat, Iranians Yearn for Change
Ukraine Finally Allows Young Men Aged Eighteen to Twenty-Two to Leave the Country
The Porn Remains, Privacy Disappears: How Britain Broke the Internet in Ten Days
YouTube Altered Content by Artificial Intelligence – Without Permission
Welcome to The Definition of Insanity: Germany Edition
Just a reminder, this is Michael Jackson's daughter, Paris.
Spotify’s Strange Move: The Feature Nobody Asked For – Returns
Manhunt in Australia: Armed Anti-Government Suspect Kills Police Officers Sent to Arrest Him
China Launches World’s Most Powerful Neutrino Detector
How Beijing-Linked Networks Shape Elections in New York City
Ukrainian Refugee Iryna Zarutska Fled War To US, Stabbed To Death
Elon Musk Sues Apple and OpenAI Over Alleged App Store Monopoly
2 Australian Police Shot Dead In Encounter In Rural Victoria State
Vietnam Evacuates Hundreds of Thousands as Typhoon Kajiki Strikes; China’s Sanya Shuts Down
UK Government Delays Decision on China’s Proposed London Embassy Amid Concerns Over Redacted Plans
A 150-Year Tradition to Be Abolished? Uproar Over the Popular Central Park Attraction
×