‘Almost all’ tax cuts reversed by new Chancellor Jeremy Hunt

Chancellor Jeremy Hunt has reversed “almost all” the tax cuts announced by his predecessor just weeks ago during an emergency intervention to steady the markets.

The Chancellor also said the planned cut to income tax would also be paused “indefinitely”.

Hunt said the reversal of almost the entire mini-budget would raise £32bn with cuts to dividend tax rates scrapped and the freeze on alcohol duty rates ended.

The scrapping of the National Insurance rise is one of the few measures set to stay because it is already working its way through the legislation.

In a further major reversal to the government's plans, Hunt announced he was ending the universal energy price cap support in April, with future support being offered on a targeted basis following a Treasury review to decide how households will be support going forward.

He said he had made the decision because it would be “irresponsible for the government to continue exposing the public finances to unlimited volatility in international gas prices”.

Hunt said he was announcing the plans early to “reduce unhelpful speculation”.

“We will reverse almost all the tax measures announced in the growth plan three weeks ago that have not started parliamentary legislation,” he added.

He also suggested there could be further measures, including cuts to public spending, despite a pledge by Truss to the contrary less than a week ago.

A full medium-term fiscal announcement is still scheduled for 31 October. It is expected to included cuts without various portfolio areas, with government departments asked to find “efficiencies”.

The Chancellor is expected to set out the details in full during a Commons statement at 3:30pm on Monday, with the Treasury saying he would “bring forward measures from the medium-term fiscal plan that will support fiscal sustainability”.

Scottish deputy first minister John Swinney is set to make a statement to Holyrood next week in response to measures taken by the UK Government.

In response to the suggestion Hunt’s statement would reduce cash to come to Scotland, he tweeted: “I never believed these Barnett consequentials would ever materialise. I knew the mini-Budget would never be sustained.”

The SNP's shadow chancellor Alison Thewliss said: "The Chancellor's statement was more than just another round of screeching U-turns, it also confirmed plans to usher in a new era of devastating Tory austerity which will further entrench the poverty the Tories have caused."

"The game is up for Liz Truss. The policies in the disastrous mini-Budget were hers and the responsibility for trashing the economy, putting people's incomes, homes and pensions at risk lies squarely at her door," she added.

Labour’s shadow chancellor Rachel Reeves said the Conservatives had “lost all credibility”.

She said: “The Chancellor said that growth requires ‘confidence and stability’ yet it’s clear that the Tories can’t provide this. There will continue to be a huge cost to families because of the actions of this Tory government.”

The government has already been forced to U-turn on their plans to remove the top 45p rate of income tax and overhaul corporation tax, but the moves have failed to steady markets.

The emergency intervention comes after markets shifted in the wrong direction on Friday following Truss's decision to sack Kwasi Kwarteng as chancellor and ditch their plans to scrap an increase in corporation tax.