© Reuters. British Prime Minister Rishi Sunak, alongside Chancellor of the Exchequer Jeremy Hunt holds his first Cabinet meeting in Downing street, London, Britain October 26, 2022. Stefan Rousseau/Pool via REUTERS
(Reuters) – British Prime Minister Rishi Sunak and Chancellor Jeremy Hunt are exploring tax increases and public spending cuts worth up to 50 billion pounds ($57.84 billion) a year to fill a hole in public finances, the Financial Times reported on Thursday, citing allies of the chancellor.
Ministers are hoping the measures will not have to be implemented in full in the fiscal statement to be published on Nov. 17, FT said, but officials want the government to use the 50 billion pound estimate after being given weak economic forecasts by the Office for Budget Responsibility.
The 50 billion pound figure comes from Treasury calculations showing an initial fiscal hole of between 30 billion pounds and 40 billion pounds, which will require tax rises or spending cuts of about 45 billion pounds because attempts to fill it will worsen the economic outlook, which will in turn hit future tax revenues, according to the newspaper.
Hunt, in the meantime, is looking at increasing the rate of windfall tax on oil and gas producers, the report said, citing people briefed on his thinking.
($1 = 0.8645 pounds)