Biden calls scrapped UK tax cut plan a ‘mistake’

President Biden on Saturday slammed a tax cut plan that British Prime Minister Liz Truss has now largely abandoned as a “mistake”.

“Well, that’s predictable. I mean, I wasn’t the only one who thought it was a mistake,” Biden said during a trip to Portland, Ore.

Truss last month announced plans to cut taxes by the equivalent of about $50 billion without specifying how it would be paid for, spooking investors.

The plan sent the price of gilts, which are UK government bonds, plummeting as the pound plunged to a record low against the dollar.

The turmoil led the Bank of England to launch an emergency bond buying program to stabilize the bond market and protect pension funds, many of which are heavily exposed to the gilt market. This bond buying program ended on Friday.

“But I think the idea of ​​cutting taxes for the super rich at a time when – anyway, I just think – I didn’t agree with the policy, but it’s up to Britain to make that judgment, not mine,” Biden said on Saturday. .

The White House, as recently as Friday, had previously declined to comment on the plan.

The tax cut announcement caused political headaches for Truss, who became prime minister last month.

Truss replaced her Treasury chief on Friday as she backtracked on plans to halt a planned rise in the corporate tax rate, and Truss is now facing criticism from some in her own party.

“It was a mistake to fly blind and announce these plans without reassuring people with the discipline of the Office for Budget Responsibility that we can actually afford to pay for them,” said Jeremy Hunt, the new head of the British Treasury, at the BBC. “We need to show the world that we have a plan that adds up financially.”

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