UK Finance Minister Kwasi Kwarteng fired after market chaos and tax-cutting plans

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Kwarteng delivers his keynote address at the annual Conservative Party Conference in Birmingham on Oct. 3, 2022.
Oli Scarff | Afp | Getty Images

LONDON — British Finance Minister Kwasi Kwarteng was fired on Friday, amid mounting political pressure and market chaos after less than six weeks in the role.

Prime Minister Liz Truss is reportedly set to announce that the government will abandon key fiscal policy pledges laid out in Kwarteng’s controversial “mini-budget” on Sep. 23, including vast quantities of unfunded tax cuts.

Among the policies on the chopping block are Kwarteng’s pledge to reverse predecessor Rishi Sunak’s hike of corporation tax from 19% to 25%, estimated to cost around ?19 billion by 2026, and a 1.25% cut to dividend tax.

The government earlier this month abolished its plan to scrap the top rate of income tax after a substantial public backlash, but this failed to quell market turbulence.

Kwarteng cut short a visit to Washington on Thursday to fly back to London as government ministers scrambled to address the market chaos unleashed in recent weeks.

This included a sell-off of long-dated government bonds that led the Bank of England to intervene in order to save pension funds from collapse, and a spike in mortgage rates for prospective homeowners.

Truss had been under immense pressure to rethink her economic policies, with opinion polls showing support for the ruling Conservative Party collapsing and lawmakers from within her own party reportedly plotting to oust her after a tumultuous first five weeks in office.

Despite this, both she and Kwarteng had remained publicly resolute in recent days, accusing critics of the government’s radical fiscal plans of being part of an “anti-growth coalition.”

This is breaking news. Please check back for updates.

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