London Daily

Focus on the big picture.
Saturday, May 31, 2025

UK's Hunt, criticised by some Conservatives, defends tax hikes

UK's Hunt, criticised by some Conservatives, defends tax hikes

British finance minister Jeremy Hunt challenged critics within the Conservative Party who are unhappy with his plan for higher taxes, saying on Friday that his new budget was needed to tackle inflation now running at a four-decade high.

Hunt announced tax increases and tighter public spending on Thursday, saying he had to bring down inflation which has surged since Russia's invasion of Ukraine compounded global supply chain disruptions that have persisted after the COVID pandemic.

Britain's budget forecasters said households faced a record hit to living standards over the next two years - the run-up to an expected general election - as the jump in inflation, which hit a 41-year high of 11.1% in October, erodes incomes.

"Over the next two years it is going to be challenging, but I think people want a government that is taking difficult decisions, has a plan that will bring down inflation, stop those big rises in the cost of energy bills and the weekly shop," Hunt told Sky News.

"None of this is easy, but it's the right thing to do."

Hunt said he deferred most of the curbs on spending because cutting now would make the current recession worse.

Asked whether Hunt's Conservative Party would support his moves to increase taxes at a time when the economy is shrinking, the finance minister said he had no choice but to take difficult decisions.

"There is nothing Conservative about spending money that you haven't got," he said. "There is nothing Conservative about not tackling inflation. There's nothing Conservative about ducking difficult decisions that put the economy on track."


RUMBLINGS OF DISCONTENT


But there have been rumblings of discontent from some senior members of the party, which has been in government since 2010.

"What I'm concerned about is that we are setting our tax policy on forecasts that have historically been wildly inaccurate, and that what we actually need to be doing is having a strategy for growth and looking to lower taxes," Jacob Rees-Mogg, a leading minister during Liz Truss's brief premiership, told Channel 4 News.

Newspaper front pages reflected the gloom, with the Conservative-supporting Daily Mail describing Hunt's plan as a "Budget to break the back of Middle Britain". The front page of the Financial Times declared "Hunt paves way for years of pain".

Paul Johnson, director of the Institute for Fiscal Studies think-tank, said Hunt's plans included more spending in the next two years before the cutbacks, but that was overshadowed by the cost of servicing Britain's 2.45 trillion-pound debt mountain.

"All of that borrowing we've done over the last many years is coming home to roost," Johnson told BBC radio.

"We're going to be stuck at 100 billion pounds a year being spent on debt interest in the medium term. And of course, when the economy is growing so dreadfully badly, there's just much less money around."

Britain's fiscal watchdog, the Office for Budget Responsibility, said on Thursday that Hunt was on track to meet a new target that he set for the government of bringing down public debt as a share of economic output within five years.

Newsletter

Related Articles

0:00
0:00
Close
Satirical Sketch Sparks Political Spouse Feud in South Korea
Indonesia Quarry Collapse Leaves Multiple Dead and Missing
South Korean Election Video Pulled Amid Misogyny Outcry
Asian Economies Shift Away from US Dollar Amid Trade Tensions
Netflix Investigates Allegations of On-Set Mistreatment in K-Drama Production
US Defence Chief Reaffirms Strong Ties with Singapore Amid Regional Tensions
Vietnam Faces Strategic Dilemma Over China's Mekong River Projects
Malaysia's First AI Preacher Sparks Debate on Islamic Principles
White House Press Secretary Criticizes Harvard Funding, Advocates for Vocational Training
France to Implement Nationwide Smoking Ban in Outdoor Spaces Frequented by Children
Meta and Anduril Collaborate on AI-Driven Military Augmented Reality Systems
Russia's Fossil Fuel Revenues Approach €900 Billion Since Ukraine Invasion
U.S. Justice Department Reduces American Bar Association's Role in Judicial Nominations
U.S. Department of Energy Unveils 'Doudna' Supercomputer to Advance AI Research
U.S. SEC Dismisses Lawsuit Against Binance Amid Regulatory Shift
Alcohol Industry Faces Increased Scrutiny Amid Health Concerns
Italy Faces Population Decline Amid Youth Emigration
U.S. Goods Imports Plunge Nearly 20% Amid Tariff Disruptions
OpenAI Faces Competition from Cheaper AI Rivals
Foreign Tax Provision in U.S. Budget Bill Alarms Investors
Trump Accuses China of Violating Trade Agreement
Gerry Adams Wins Libel Case Against BBC
Russia Accuses Serbia of Supplying Arms to Ukraine
EU Central Bank Pushes to Replace US Dollar with Euro as World’s Main Currency
Chinese Woman Dies After Being Forced to Visit Bank Despite Critical Illness
President Trump Grants Full Pardons to Reality TV Stars Todd and Julie Chrisley
Texas Enacts App Store Accountability Act Mandating Age Verification
U.S. Health Secretary Ends Select COVID-19 Vaccine Recommendations
Vatican Calls for Sustainable Tourism in 2025 Message
Trump Warns Putin Is 'Playing with Fire' Amid Escalating Ukraine Conflict
India and Pakistan Engage Trump-Linked Lobbyists to Influence U.S. Policy
U.S. Halts New Student Visa Interviews Amid Enhanced Security Measures
Trump Administration Cancels $100 Million in Federal Contracts with Harvard
SpaceX Starship Test Flight Ends in Failure, Mars Mission Timeline Uncertain
King Charles Affirms Canadian Sovereignty Amid U.S. Statehood Pressure
Trump Threatens 25% Tariff on iPhones Amid Dispute with Apple CEO
Putin's Helicopter Reportedly Targeted by Ukrainian Drones
Liverpool Car Ramming Incident Leaves Multiple Injured
Australia Faces Immigration Debate Following Labor Party Victory
Iranian Revolutionary Guard Founder Warns Against Trusting Regime in Nuclear Talks
Macron Dismisses Viral Video of Wife's Gesture as Playful Banter
Cleveland Clinic Study Questions Effectiveness of Recent Flu Vaccine
Netanyahu Accuses Starmer of Siding with Hamas
Junior Doctors Threaten Strike Over 4% Pay Offer
Labour MPs Urge Chancellor to Tax Wealthy Over Cutting Welfare
Publication of UK Child Poverty Strategy Delayed Until Autumn
France Detains UK Fishing Vessel Amid Post-Brexit Tensions
Calls Grow to Resume Syrian Asylum Claims in UK
Nigel Farage Pledges to Reinstate Winter Fuel Payments
Boris and Carrie Johnson Welcome Daughter Poppy
×