Newly installed British Prime Minister Liz Truss told parliament on Wednesday that she would tackle Britain’s “very serious” energy crisis while cutting taxes, ruling out imposing a windfall tax on oil companies to pay for her plans to offset soaring oil prices heating and electricity costs.
Truss rejected opposition calls for a new windfall tax, though she refrained from explaining how she would fund a plan to help the public pay skyrocketing energy bills due to the invasion of Ukraine by Russia and economic replicas of COVID-19 and Brexit.
She said in her first question and answer session to the Prime Minister that she would set out a plan on Thursday to help deal with the immediate price crisis so that people “can get through this winter”, as well as measures to strengthen the Britain’s long-term energy. Security.
But she added: “I am against an exceptional tax. I believe it is wrong to deter companies from investing in the UK at a time when we need the economy to grow.
“This country will not be able to tax its way to growth,” she said, to thunderous cheers from Tory lawmakers in a packed House of Commons.
Truss’s spokeswoman said she would not reverse a one-off tax imposed in May by the former Treasury Chief Rishi Sunak, his defeated rival to the leadership of the Conservatives, but would not bring a new one. She is also dropping a previously announced increase in corporation tax from 19% to 25%.
Opposition Labor Party leader Keir Starmer said it was tantamount to handing over billions to energy companies that have pocketed large profits due to high energy prices. Instead, the cost of price relief will have to be paid by British taxpayershe said, calling Truss’ economic plans a “conservative fantasy”.
British media reported that Truss planned to cap energy bills. The cost to taxpayers of this step could reach 100 billion pounds ($116 billion).
‘The Prime Minister knows she has no choice but to support an energy price freeze, but it won’t be cheap and the real choice, the political choice is who is going to pay’ , Starmer said. “Is she really telling us that she is going to leave vast excess profits (from energy companies) on the table and make working people foot the bill for decades to come?”
Truss’s office said there will be a “bold action plan” to support households and businesses with rising energy bills while seeking to boost home energy supply.
“Putin’s war in Ukraine and the militarization of gas supplies in Europe are driving up global prices – and that has only made it clear that we need to strengthen our long-term energy security and supply.” Truss said in a statement Thursday. “We will take immediate action to help individuals and businesses pay their bills, but we will also take decisive action to address the root cause of these issues, so that we are no longer in this situation.”
Although environmentalists have condemned both North Sea oil and gas exploration and fracking, Truss said on Thursday she promised more North Sea drilling and the removal of the fracking ban.
Fracking was first attempted in the UK in 2011but was closed after facing a series of problems including earthquakes at its Lancashire site.
In 2019, the government created an effective moratorium on fracking, saying that only if fracking was proven not to cause earthquakes could it continue.
In her first speech as Prime Minister on Tuesday, Truss said she would cut taxes to boost economic growth, strengthen the NHS and “deal” with the energy crisis.
“We shouldn’t be intimidated by the challenges we face,” Truss said in his speech. “As strong as the storm is, I know that the British are stronger.”
The Associated Press contributed to this report.