Why Is This Tax Cut So Big?

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The new UK government announced the biggest tax cuts since at least the 1970s. The announcement shocked markets, with the pound falling against the dollar to a level last seen in 1985. In the bond markets, the cost of government borrowing had its biggest one-day rise ever and certainly since the early 1990s. This is happening at a time when inflation is already close to its highest level in decades.

UK chancellor Kwasi Kwarteng has vowed to double down on his controversial tax-cutting drive despite investor jitters, at least 41 people have died in protests in Iran sparked by the death of a young woman who was arrested for allegedly violating Islamic dress code. Plus, the FT’s Polina Ivanova explains how Russia’s military conscription is affecting remote regions of the country.

Mentioned in this podcast:

Radical UK budget prompts backlash on Tory backbenches

Investors warn Kwarteng that fiscal plan threatens markets’ confidence in UK

Death toll from Iranian protests climbs to 41

‘Everyone will get snatched off the street’: mobilisation brings Ukraine war home to Russians

FT.com/briefingsale

The FT News Briefing is produced by Fiona Symon, Sonja Hutson and Marc Filippino. The show’s editor is Jess Smith. Additional help by Peter Barber, Michael Lello, David da Silva and Gavin Kallmann. Topher Forhecz is the FT’s executive producer. The FT’s global head of audio is Cheryl Brumley. The show’s theme song is by Metaphor Music.

Read a transcript of this episode on FT.com

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