UK finance minister Kwarteng unveils measures to boost growth


© Reuters. FILE PHOTO: New British Chancellor of the Exchequer Kwasi Kwarteng walks outside Number 10 Downing Street, in London, Britain September 6, 2022. REUTERS/Toby Melville

LONDON (Reuters) – British finance minister Kwasi Kwarteng is presenting a mini-budget to parliament on Friday with the aim of cutting taxes and energy bills for households and businesses to try to drive economic growth.

ONE OF THE MOST SIGNIFICANT INTERVENTIONS

“People will have seen the horrors of (Russian President Vladimir) Putin’s illegal invasion of Ukraine. They will have heard reports that their already-expensive energy bills could reach as high as 6,500 pounds ($7,253) next year. Mr Speaker, we were never going to let this happen. The prime minister has acted with great speed to announce one of the most significant interventions the British state has ever made.”

NEW APPROACH FOR NEW ERA

“Growth is not as high as it needs to be … We need a new approach for a new era, focused on growth. Our aim, over the medium term, is to reach a trend rate of growth of 2.5%.”

BARRIERS FOR ENTERPRISE

“There are too many barriers for enterprise. We need a new approach to break them down. That means reforming the supply side of our economy.”

STRIKE DISRUPTION UNACCEPTABLE

“At such a critical time for our economy, it is simply unacceptable that strike action is disrupting so many lives. Other European countries have minimum service levels to stop militant trade unions closing down transport networks during strikes. So we will do the same. And we will go further.”

BANKS SHOULD PAY TAXES IN LONDON, NOT PARIS OR NEW YORK

“We need global banks to create jobs here, invest here and pay taxes here in London, not Paris, not Frankfurt, not New York. All the bonus cap did was to push up the basic salaries of bankers, or drive activity outside Europe. It never capped total remuneration, so let’s not sit here and pretend otherwise. So we’re going to get rid of it.”

TAX CENTRAL TO SOLVING GROWTH RIDDLE

“We come to tax — central to solving the riddle of growth. The tax system is not simply about raising revenue for public services, vitally important though that is. Tax determines the incentives across our whole economy. And we believe that high taxes reduce incentives to work, they deter investment and they hinder enterprise.”

LOWEST CORPORATE TAX IN G20

“We will have the lowest rate of corporation tax in the G20. This will plough almost 19 billion pounds a year back into the economy. That’s 19 billion pounds for businesses to reinvest, create jobs, raise wages, or pay the dividends that support our pensions.”

FIGHT OVER REDISTRIBUTION

“For too long in this country, we have indulged in a fight over redistribution. Now, we need to focus on growth, not just how we tax and spend. We won’t apologise for managing the economy in a way that increases prosperity and living standards. Our entire focus is on making Britain more globally competitive – not losing out to our competitors abroad.”

HIGH TAXES DAMAGE BRITAIN’S COMPETITIVENESS

“High tax rates damage Britain’s competitiveness. They reduce the incentive to work, invest, and start a business. And the higher the tax, the more ways people seek to avoid them, or work elsewhere or simply work less … rather than putting their time and money to more creative and productive ends.”

($1 = 0.8962 pounds)