When Kwasi Kwarteng unveiled his mini-budget last month, he announced that the 45% rate of tax for people who earn over £150,000 a year would be abolished from April 2023. Scrapping the top rate would mean that these top earners would be paying 40% tax from then on: the same amount of tax as someone on a salary of £50,271 pays.

The Treasury later confirmed that as a result of the policy, 660,000 top earners would recoup about £10,000 a year. Coming at a time when the vast majority of people are seriously concerned about skyrocketing energy prices and the cost of living, the policy was roundly criticised for supporting the wealthy at a time of economic crisis, rather than focusing on those in greatest need.

News of these tax cuts, combined with the announcement of major government borrowing, prompted concerns about the UK’s financial stability, and the pound dropped to a record low against the dollar last week.

The turmoil continued as banks and mortgage providers started to withdraw their services from the market in droves, with financial information company Moneyfacts stating that more than 40% of available mortgages had been removed from the market in the week following the mini-budget. The Bank of England eventually made a major intervention with the aim of stabilising the situation, announcing that it would buy £65 billion of long-term government bonds known as gilts.

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