Kwasi Kwarteng and Liz Truss have said they will U-turn on a £2 billion plan to cut taxes for Britain’s highest earners.
The abolition of the 45p top rate of tax was confirmed on Monday morning – it was arguably the most controversial part of the government’s mini budget.
But the about-face came just 24 hours after ministers said there was no chance of them changing course. Here’s how events unfolded.
Friday 23 September
Kwasi Kwarteng announces that he was abolishing the top rate of tax. The Treasury says the measure is “designed to attract the best and the brightest to the UK workforce, helping businesses innovate and grow”.
The Institute for Fiscal Studies says that with all the tax changed announced in the budget, “only those on over £155,000 will pay less tax overall” and that “the very rich will pay tens of thousands less”.
Former Cabinet member Julian Smith is among the first Tory MPs to speak out. He says that “this huge tax cut for the very rich at a time of national crisis and real fear and anxiety amongst low income workers and citizens is wrong”.
Monday 26 September
The Financial Times reports that dissent is “rife” over the measures in the Tory parliamentary party. One former minister tells the paper: “Truss and Kwarteng are acting like they are still in a student debating society, where you can pursue some kind of extreme philosophy without there being any consequences.”
At Labour Party conference, shadow chancellor Rachel Reeves promises a Labour government would bring back the 45p tax rate and use the money to invest in the NHS.
Thursday 29 September
A poll by YouGov finds the Tories have plunged in popularity, with Labour taking a 33 point lead over the party. Other polls also show leads for the opposition around or in excess of 20 points.
Friday 30 September
Liz Truss does a tour of local radio stations but is left lost for words as presenters grill her over her policies. She stands by the tax cuts.
Sunday 2 October
Morning
In a flagship eve-of-conference interview with the BBC, Liz Truss stands by her tax cut plan.
Tory chair Jake Berry is sent onto Sky News to say Tory MPs who vote against the plan will lose the whip.
Michael Gove says cutting the top rate of tax is a “mistake” and suggests he might not vote for the budget over it.
Afternoon
Chris Philip, the chief secretary to the Treasury, is late to a fringe event at Tory conference due to “urgent ministerial business”.
Evening
The Daily Telegraph newspaper, widely regarded as a house organ of the Conservative party, runs an editorial: “Liz Truss is not for turning”, in which it defends the policy.
The Daily Mail newspaper, which also supports the Conservative government, runs its first edition with the splash headline: “Fury as Gove stoke Tory 45p tax revolt”. The newspapers second edition runs with a different headline: “Are Tories on brink of 45p tax U-turn?”
Sky News reports that a Cabinet minister has privately said a vote on the cutting of the 45p rate would be delayed.
Monday 3 October
First thing in the morning, Kwasi Kwarteng announces that the government is “not proceeding with the abolition of the 45p rate” and says it has become a “distraction from our overriding mission”.
Liz Truss adds: “We get it and we have listened”. The policy is however £2 billion of a wider package of tax cuts, and is dwarfed by cuts in corporation tax.
