Urgent review ordered into mini budget tax cuts following Bank of England issuing emergency measures

The Prime Minister has ordered an urgent review into tax cuts in the mini budget amid the continued market turmoil.

The Chancellor Kwasi Kwarteng was forced to admit last week that the government made the U-turn on the 45p top rate of tax amid public and backbench anger.

The Prime Minister insisted that the measures within the budget were required to get Britain moving again.

On Tuesday the Bank of England issued emergency measures and pledged to buy more government bonds to try and stabilise market conditions.

Nigel Green of deVere Group told LondonLovesBusiness.com yesterday, that the “The bond market is in utter chaos again.

“This has forced the Bank of England to step in with the unusual move to spend £5 billion on index-linked securities. It comes in addition to the £5 billion allocated for conventional gilts.

“Since the reckless ‘mini-budget’ at the end of last month, UK financial markets have been in a tailspin, reeling from the government’s controversial plans to slash taxes and increase spending in a desperate dash for growth.

“This latest dramatic selloff saw UK inflation-linked bond yields surging by record levels, forcing the Bank of England to intervene to try and restore some kind of order.”

A Downing Street official told The Independent that staff “have been told to go through the measures and the OBR’s working line by line.”

They added, “The turmoil in markets and the need to show fiscal prudence are being heeded. Everything is being looked at again, including tax cuts.

“The picture will change a lot if energy measures are means-tested carefully next winter and wholesale prices calm down a little.

“But that’s not enough on its own to balance the books as has been suggested, by getting debt down as a share of GDP.”

On Tuesday night MPs passed a Bill to reverse April’s hike in national insurance contributions.

However Truss had promised in the Conservative leadership election to reverse the contributions.

The Chancellor said, “Reversing the National Insurance rise is a promise delivered.

“It means an average saving of £330 a year for 28 million workers in the UK, and I’m delighted we will get a step closer to this today as the Bill passes through the Commons.”