IMF tax warning sounds ‘alarm bells’
The UK Government must abandon its calamitous tax cuts for the rich to avoid an economic catastrophe that threatens to scar generations to come, the Scottish Greens say.
MSPs say they are fearful of the real-time and long term impacts of the Tory economic policies announced by the Chancellor Kwasi Kwarteng on Friday.
They are urging the Treasury and Prime Minister Liz Truss to “do the right thing” and reverse course on their position and plans.
The warning comes as the International Monetary Fund, respected global ratings agency Moody’s, the US Treasury Department and a slew of other financial experts indicated concern over the tax announcements and their subsequent immediate impacts on markets and interest rates.
It also comes as new figures show the cost of goods in the shops has risen 5.7% in September and the launch of a new Scottish Government website today to help people source trustworthy ways to seek cost of living advice.
Maggie Chapman MSP, the party’s economy spokesperson, said:
“This is beyond party politics, this is a real time tragedy playing out before our eyes.
“The disastrous policies that Liz Truss and Kwasi Kwarteng have introduced are no accident. Time and again, they have made clear that their priority is to look after their millionaire friends. We are in the worst cost crisis for decades, but they seem hellbent on using their power to funnel yet more money into the pockets of the super rich, to be hoarded offshore.
“The consequences on the financial markets and business sector are already clear as institutions react.
“But the impacts on ordinary people will become life changing, as people lose their homes through higher mortgage payments, are plunged into debt, struggle with fuel bills and weekly shopping, and potentially find their jobs at risk.
“This is becoming a living tragedy which if unchecked could scar generations to come. The UK government has to put aside its pride and reconsider its reckless set of tax cuts before it’s too late.”
Finance spokesperson Ross Greer MSP said it is clear a reversal of cuts and increase in public expenditure is needed.
These unfunded tax cuts for the rich risk not only making the looming recession worse here in the UK, they will impact economies around the world, which is why the IMF and others have issued this extremely unusual criticism.
“The Tories have shown they either did not understand or did not care what the impacts of these cuts would be, but it's the public who will suffer from them in everything from public service cuts to rising mortgage costs.
“Coming on the back of the pandemic and a decade of Conservative cuts, these were spectacularly incompetent choices for Truss and Kwarteng to make. They must reverse course immediately to avoid further damage to the UK economy and household finances.”