It’s Lights Out: IEA and TPA Slam Mini-Budget U-Turns mdi-fullscreen

With Hunt shredding almost the entire mini-Budget, the free marketeer wonks have released horrified statements as the Chancellor bins almost all the tax cuts Liz promised for the last four months. The only silver lining is that the energy support will now be means-tested. Other than that, it’s brutal…

The TaxPayers’ Alliance didn’t mince its words. Chief Executive John O’Connell put out a withering putdown:

“The light at the end of the economic tunnel has now been extinguished by this chancellor. Millions of hard-hit households who were desperate for an income tax cut are now facing many more months of financial misery. To get a grip on this crisis, the government needs to lay out a serious plan for necessary spending reductions, including means-testing energy support measures.”

The Institute of Economic Affairs is also critical of the scale of the U-turn, although the tweaks to the energy package were welcomed. Director-General Mark Littlewood said:

“The Energy Price Guarantee was always an unnecessarily expensive programme, representing the single biggest welfare scheme in British history. As many of us said at the time, it is absurd to subsidise wealthy households to keep heating their swimming pools. A more targeted approach from next year is warmly welcome and will save significant money… The risk of higher taxes is that they put Britain back on the path towards a high tax, low-growth economy. As Goldman Sachs warned yesterday, higher corporate tax rates could deepen any forthcoming recession and ultimately damage the government’s fiscal position.”

Likewise, the Adam Smith Institute encouraged No.11 to at least stay focused on supply-side reforms. Head of Communications Emily Fielder added:

“The Chancellor has said that there will be difficult decisions on tax and spend in the coming years as we move towards a more secure financial footing. But there is plenty this Government can do which doesn’t involve changing tax thresholds or spending pledges ––moving forward with supply-side regulatory reforms would boost economic growth and activity at a time when it is desperately needed. The decision to properly target the energy price guarantee from April is welcome…”

Hopefully Prime Minister Jeremy Hunt is listening…

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