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Jeremy Hunt has revealed he is reversing “almost all” of the tax cuts announced in his predecessor’s mini-budget and is scaling back support for energy bills.

In an emergency statement, the chancellor said a 1p cut to income tax will be delayed “indefinitely” until the UK’s finances improve instead of being introduced in April 2023 as announced in Kwasi Kwarteng’s mini-budget three weeks ago.

Mr Hunt, who only stepped into the job on Friday, said the government’s energy price guarantee will only be universal until April – not for two years as originally planned.

After April, the scheme will be more targeted following a review into how to support people’s energy bills from that time, he said.

Hunt goes further than expected – as Tory MPs say it’s ‘when not if’ Truss goes – follow latest on politics

“The government has today decided to make further changes to the mini-budget, and to reduce unhelpful speculation about what they are, we’ve decided to announce these ahead of the medium-term fiscal plan, which happens in two weeks,” Mr Hunt said.

He said the government was reversing “almost all” the tax measures announced in the mini-budget that have not yet started going through parliament.

The Treasury said new tax measures would bring in £32bn after economists estimated the government was facing a £60bn black hole in public finances with the mini-budget announcements.

The changes Mr Hunt revealed include:

  • No cuts to dividend tax rates
  • Repeal of the easing of IR35 rules for the self-employed introduced in 2017 and 2021
  • No new VAT-free shopping scheme for overseas visitors to the UK
  • No freeze on alcohol duty rates
  • Basic rate of income tax to remain at 20%, not reduce to 19% from April 2023
  • Energy price guarantee only until April 2023.

‘A new approach’

Mr Hunt promised: “The objective is to design a new approach that will cost the taxpayer significantly less than planned, whilst ensuring enough support for those in need.

“Any support for businesses will be targeted to those most affected, and the new approach will better incentivise energy efficiency.

“The most important objective for our country right now is stability.”

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As Mr Hunt revealed the tax cut reversals, the pound strengthened by more than 1.2% to 1.139 against the US dollar and UK government bonds rallied further, with yields on 30-year gilts easing back by around 10%.

Widely seen as the most powerful person in government now, Mr Hunt added that there will be “more difficult decisions” on tax and spending” and said all government departments “will need to redouble their efforts to find savings, and some areas of spending will need to be cut”.

The mini-budget tax cuts that will not be reversed, as they are already going through parliament, are: reversing the increase in national insurance contributions and the stamp duty cut.

Ms Truss’ spokesman said Monday’s decision was taken jointly by the PM and Mr Hunt over the weekend and again admitted the mini-budget went “too far, too fast”.

But he sidestepped questions about whether Ms Truss would resign after another Tory, Angela Richardson, joined those who started publicly calling for her to go over the weekend.

‘Genuinely shocking’

Sky News’ political editor Beth Rigby said this row back on the mini-budget is a major blow for Liz Truss, just six weeks into her premiership.

“The entire platform of the Truss administration is gone, is gone. It’s done,” she said.

“It’s genuinely shocking in terms of how a prime minister and her cabinet got this so wrong and had to reverse in such a dramatic way.”

“It’s not just the tax decisions in the mini-budget that the new chancellor now says are just not viable.

“He’s now saying that the policy platform, her big shock and awe announcement as it was billed in the run-up to that announcement is also just economic, not viable. And that is another body blow to the prime minister today.”

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‘We think she should go’ – Labour

‘Still flying blind’

Scottish First Minister Nicola Sturgeon used a news conference about Scottish independence shortly after Mr Hunt’s statement to say the government turmoil is “a self-inflicted crisis for Liz Truss” and “is humiliating in quite an unprecedented way”.

“I think the sooner this prime minister and this entire government departs office, the better that will be for everyone,” she added.

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The most significant part of Volodymyr Zelenskyy’s olive branch offering to Donald Trump

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The most significant part of Volodymyr Zelenskyy's olive branch offering to Donald Trump

Ukraine’s president is offering an olive branch to Donald Trump with a dramatic public message aimed at mending their relationship and ending Russia’s war.

Volodymyr Zelenskyy chose social media – the US leader’s favourite mode of communication – to make his point.

He did not go so far as to apologise for a fiery bust-up with Mr Trump at the Oval Office last Friday – a move that some members of the US administration have called for, even though it was the American president and his deputy JD Vance who laid into Mr Zelenskyy.

Instead, he described the encounter as “regrettable”, saying it “did not go the way it was supposed to be” and it was “time to make things right”.

Ukrainian servicemen fire a BM-21 Grad multiple-launch rocket system toward Russian troops on a front line near the town of Chasiv Yar
Tuesday, 25th February 2025, 08:48
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Ukrainian forces fire a missile towards Russian troops near Chasiv Yar. Pic: Reuters

Most significantly though was his spelling out of a vision for the first stage of how Russia’s war with Ukraine could end.

Pushing back on false claims by Trump allies such as Elon Musk that Mr Zelenskyy wants an endless war, he said that Ukraine is committed to peace and is ready to come to the negotiating table as soon as possible.

Crucially, he said: “We are ready to work fast to end the war, and the first stages could be the release of prisoners and truce in the sky – ban on missiles, long-ranged drones, bombs on energy and other civilian infrastructure – and truce in the sea immediately, if Russia will do the same.”

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Appealing to the US president’s ego, he praised Mr Trump’s “strong leadership” and repeated his gratitude for past American support – again responding to criticism from the American commander in chief and his team that he is not showing enough gratitude.

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He also said Kyiv was ready to sign a key minerals deal with Washington – something else Mr Trump is seeking.

This message appears to be an attempt by Mr Zelenskyy to steer his relationship with Mr Trump back on track and to map out his idea for an end to the war – a conflict that Ukraine did not seek but which was brought to its land by Russia’s invading forces.

Donald Trump and Volodymyr Zelenskyy at the White House. Pic: AP
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Donald Trump and Volodymyr Zelenskyy at the White House on Friday, before their Oval Office bust-up. Pic: AP

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Canada warns ‘no winners in a trade war’
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Key now will be how the US president responds.

Will Mr Zelenskyy’s expression of regret and clear wish to end the war provide enough of an off-ramp for Mr Trump to defuse the row and – for the sake of Ukraine’s ability to defend itself – switch back on the flow of military assistance to the country?

Another major factor, of course, is how Vladimir Putin reacts and whether he could countenance a limited ceasefire in a war that he started and – unlike Mr Zelenskyy – appears to have no genuine desire to halt.

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Donald Trump confirms Mexico and Canada tariffs – prompting a stock sell-off

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Donald Trump confirms Mexico and Canada tariffs - prompting a stock sell-off

Donald Trump’s 25% tariffs on goods from Mexico and Canada have come into effect, as has an additional 10% on Chinese products, bringing the total import tax to 20%.

The US president confirmed the tariffs in a speech at the White House – and his announcement sent US and European stocks down sharply.

The tariffs will be felt heavily by US companies which have factories in Canada and Mexico, such as carmakers.

Mr Trump said: “They’re going to have a tariff. So what they have to do is build their car plants, frankly, and other things in the United States, in which case they have no tariffs.”

There’s “no room left” for a deal that would see the tariffs shelved if fentanyl flowing into the US is curbed by its neighbours, he added.

Mexico and Canada face tariffs of 25%, with 10% for Canadian energy, the Trump administration confirmed.

And tariffs on Chinese imports have doubled, raising them from 10% to 20%.

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Canada announced it would retaliate immediately, imposing 25% tariffs on US imports worth C$30bn (£16.3bn). It added the tariffs would be extended in 21 days to cover more US goods entering the country if the US did not lift its sanctions against Canada.

China also vowed to retaliate and reiterated its stance that the Trump administration was trying to “shift the blame” and
“bully” Beijing over fentanyl flows.

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What is America’s trade position?

Mr Trump’s speech stoked fears of a trade war in North America, prompting a financial market sell-off.

Stock market indexes the Dow Jones Industrial Average and the Nasdaq Composite fell by 1.48% and 2.64% respectively on Monday.

The share prices for automobile companies including General Motors, which has significant truck production in Mexico, Automaker and Ford also fell.

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Consumers in the US could see price hikes within days, an expert has said.

Gustavo Flores-Macias, a public policy professor at Cornell University, New York, said “the automobile sector, in particular, is likely to see considerable negative consequences”.

This is due to supply chains that “crisscross the three countries in the manufacturing process” and ” because of the expected increase in the price of vehicles, which can dampen demand,” he added.

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Trump hits out at Zelenskyy again

The Trump administration is gearing up to bring in other tariffs in the coming weeks.

On 2 April, reciprocal tariffs will take effect on all countries that impose duties on US products.

He is also considering 25% tariffs on goods from the EU “very soon” after claiming the bloc was created to “screw the United States”.

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More than 30 killed in Bolivia bus crash – second deadly collision within days

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More than 30 killed in Bolivia bus crash - second deadly collision within days

A truck has collided with a bus in southern Bolivia, killing at least 31 people, according to police – just two days after a deadly crash claimed at least 37 lives.

Officers said the bus rolled some 500m (1,640ft) down a ravine after the collision on Monday, which took place on the highway between Oruro, in the Bolivian Altiplano, and the highland mining city of Potosi.

The driver of the truck has been arrested, while the cause of the accident is under investigation.

Police spokesperson Limbert Choque said men and women were among the dead, and 22 people suffered injuries.

** on right of picture are bodies ** First responders work at the site after a crash between a vehicle and a bus along a highway in Lenas, Potosi, southern Bolivia, March 3, 2025, in this handout image obtained from social media. Bolivia's Attorney General/Handout via REUTERS THIS IMAGE HAS BEEN SUPPLIED BY A THIRD PARTY. NO RESALES. NO ARCHIVES. MANDATORY CREDIT
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Rescue teams operating at the site of the crash. Pic: Bolivia’s attorney general/Reuters

Bolivia’s President, Luis Arce, expressed condolences for the victims on social media: “This unfortunate event must be investigated to establish responsibilities,” he said in a post on Facebook.

“We send our most sincere condolences to the bereaved families, wishing them the necessary strength to face these difficult times.”

Map showing location of collision, which took place on the highway between Oruro, in the Bolivian Altiplano, and the highland mining city of Potosi.
Image:
The crash happened between Oruro and Potosi

On Saturday morning, a crash between two buses killed more than three dozen people in the same region.

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It happened between Colchani and the city of Uyuni, a major tourist attraction and the world’s largest salt flat.

People stand near the wreckage of one of the two buses involved in the crash.
Pic: Reuters/Potosi Departmental Command
Image:
People stand near the wreckage of one of the two buses involved in a crash on Saturday. Pic: Reuters/Potosi Departmental Command

Coincidentally, one of the buses was heading to Oruro, where one of the most important carnival celebrations in Latin America is currently taking place.

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More than 30 people were also killed after a bus crash on 17 February.

In that crash, police said the driver appeared to have lost control of the vehicle, causing it to drop more than 800m (2,600ft) off a precipice in the southwestern area of Yocalla.

Bolivia’s mountainous, undermaintained and poorly supervised roads are some of the deadliest in the world, claiming an average 1,400 fatalities every year.

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