UK Prime Minister Liz Truss is to delay the vote on abolishing the 45 percent top rate of income tax, Sky News reported, citing a cabinet minister.
The policy was part of the government’s Growth Plan, dubbed a mini-budget, unveiled on September 23 by Chancellor Kwasi Kwarteng, that prompted financial turmoil, with the pound reaching record lows against the dollar.
Disapproval of the controversial plan to remove the 45 percent rate of income tax from Britain’s higher earners - which would benefit the wealthiest 1% - has since been publicly voiced by at least 13 Tory MPs. While it had been expected that the vote on the decision could come as early as next week, it is now likely to be pushed back until after MPs have been told how the measure will be funded in the Chancellor's medium-term plan on November 23, said government sources.
The approval vote could be delayed until December, or even next spring, sources told The Telegraph and Sky News.
A backbench rebellion has reportedly been gaining strength in a bid to force Liz Truss to U-turn on the mini-budget. Around 70 Tory MPs are considering voting against the move, one rebel MP was cited as saying on Sunday night.
‘Tax Cuts for the Wealthy’
The reports that the Prime Minister was planning to delay a vote on cutting the 45 percent income tax rate came after Michael Gove, the former Levelling Up Secretary, indicated that he would not vote to scrap the 45% rate.
Speaking on the first day of the 2022 Conservative Party Conference, taking place on October 2-5 in Birmingham, Gove said the measure displays the “wrong values” and suggested that Truss does not have a mandate for the move. Gove accused the Government of “betting too much on tax cuts,” and said he was “profoundly concerned” about the decision to borrow to fund tax cuts, calling it “not Conservative.”
Former Transport Secretary Grant Shapps also slammed the policy, as he warned the PM not to have a "tin ear" to voters' concerns over the bitter cost of living crisis.
"Let's not muddy the water with... tax cuts for wealthy people right now, when the priority needs to be on everyday households. I don't think the House is in a place where it's likely to support that," he told the BBC on the first day of the Tory conference.
George Osborne, the former chancellor, believed that it was “touch and go” whether Kwasi Kwarteng can survive now, as “ruthless prime ministers will throw their chancellors under a bus.” He also told the Andrew Neil Show on Channel 4 that if the Chancellor’s speech on Monday – Day 2 of the Conference - goes badly, “it’s curtains.”
The vocal disapproval of the mini-budget measures came just hours before Chancellor Kwasi Kwarteng is expected to tell the Tory Conference that the government’s plan is "sound, credible and will increase growth."
Kwarteng is expected to double down on the mini-budget, saying:
"We must face up to the facts that for too long our economy has not grown enough. The path ahead of us was one of slow, managed decline and I refuse to accept that it is somehow Britain's destiny to fall into middle-income status. Or that the tax burden reaching a 70-year-high is somehow inevitable. It isn't, and shouldn't be. We needed a new approach, focused on raising economic growth. We must stay the course. I am confident our plan is the right one."
During his speech on the second day of the gathering the Chancellor is expected to promise that the new Growth Plan will result in more businesses, jobs, higher pay and more money for public services, saying the country "cannot have a strong NHS without a strong economy," nor good schools or quality infrastructure.
Liz Truss defended the government’s plans as she gave a BBC interview on Sunday, while conceding that the presentation of the mini-budget was flawed.
“I do stand by the package we announced and I stand by the fact we announced it quickly, because we had to act,” she said. But I do accept we should have laid the ground better. I have learned from that, and I will make sure that in future we do a better job of laying the ground,” Truss said.