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Liz Truss has ordered officials to work on ways of reversing major parts of her government’s mini-budget and tax cuts as the markets went into freefall, sources have claimed. With Chancellor Kwasi Kwarteng set to meet the International Monetary Fund (IMF) in the next few hours, Ms Truss’ government was forced to act quickly as guilt yields which underpin borrowing and interest rates dropped dramatically.
The Prime Minister has been left fighting for her political life just five weeks after replacing Boris Johnson with the markets reacting badly to her Chancellor’s mini budget which included borrowing to make tax cuts.
Earlier today her spokesman told journalists that there was no plans for any further U-turns following the decision last week to abandon the idea of scrapping the 45p top rate of income tax for high earners.
The spokesman said the tax cuts outlined on September 23 and their proposed timeline would go ahead as planned.
“The position has not changed,” he said.
“And obviously as you know the date for the medium-term fiscal plan has been brought forward.”
Mr Kwarteng will set out broader economic plans on October 31, three weeks earlier than originally planned, in order to help calm the markets.
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