The new UK Government has introduced measures to cut taxes and stimulate growth as recent data showed the economy sliding into recession at the end of the third quarter. Kwasi Kwarteng, Chancellor of the Exchequer, has announced a 45 billion-pound (USD 50 billion) package of tax cuts.

Kwarteng confirmed that the government would cancel a planned increase in corporate income tax from 19 per cent to 25 per cent. Kwarteng confirmed ending an EU-inspired cap on bankers’ bonuses and reducing the stamp duty payable on home purchases.

In addition, he declared a cut in the top rate of personal income tax to 40 per cent from April, as well as pre-announcing a cut in the basic income tax rate to 19 per cent. On Thursday, the government had already cancelled a planned hike in national insurance contributions, introduced by former Prime Minister Boris Johnson.

The introduced package represents a sharp turn away from the policies of Boris Johnson. He had increased taxes and public expenditure to cement electoral support among lower-income voters in Britain’s poorer regions.

Earlier, the composite UK purchasing managers index (PMI) compiled by S&P Global declined to 48.2, it’s lowest since February 2021, from 48.9 in August.