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IMF tells UK to 're-evaluate' unfunded tax cuts as global criticism mounts

Prime Minister Liz Truss's decision to cut taxes by the most since the early 1970s and cover them via borrowing at a time of surging inflation has rattled financial markets and drawn concern

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The IMF said that Chancellor Kwasi Kwarteng should use a plan scheduled for release in November to “consider ways to provide support that is more targeted and re-evaluate the tax measures (Photo: Bloomberg)

Eric Martin | Bloomberg
The International Monetary Fund delivered a stinging rebuke of the UK’s new unfunded tax cuts by calling them excessive and in need of revision, adding to criticism of a plan which has sent the pound to a record low.
 
“Given elevated inflation pressures in many countries, including the UK, we do not recommend large and untargeted fiscal packages at this juncture, as it is important that fiscal policy does not work at cross purposes to monetary policy,” a spokesperson for the Washington-based lender said Tuesday in a statement. “Furthermore, the nature of the UK measures will likely increase inequality.”

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First Published: Sep 28 2022 | 8:31 AM IST

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