El nuevo gobierno del Reino Unido aborda el coste de la vida con una reducción del impuesto a la energía

London Britain’s new Prime Minister Andy Burnham launched his campaign to alleviate the cost of living crisis by announcing plans to eliminate VAT on household electricity bills starting in October. The move, part of a broader strategy to ease financial strain on families, will save the average household approximately £45 annually. The policy, set to begin alongside an anticipated increase in the energy price cap, aims to benefit lower-income households, which allocate a larger share of their earnings to energy costs. Burnham, who assumed office on July 20 following his appointment by King Charles III, outlined the tax cut during his first public address at 10 Downing Street. The decision marks a shift from the previous Labour government’s approach, which had introduced several tax increases aimed at reducing the deficit. To fund the energy relief, the government will cancel its previously planned digital ID scheme, projected to cost taxpayers £1.8 billion. This adjustment reflects Burnham’s commitment to balancing fiscal responsibility with measures to support struggling households. In addition to addressing consumer costs, Burnham has expressed concern over the impact of recent tax policies on small businesses. The previous administration’s efforts to raise revenue through increased taxation have placed additional burdens on these enterprises, prompting calls for regulatory easing. Burnham has pledged to maintain the fiscal discipline established under his predecessor, Keir Starmer, ensuring that government spending remains aligned with available revenues. On July 21, official statistics revealed that public sector net borrowing fell to £16 billion in June, marking a decline of nearly one-third compared to the same period the previous year. This reduction, attributed to improved fiscal management, bolstered the position of newly appointed Finance Minister John Healey, who succeeded Rachel Reeves. Despite the progress, the Office for National Statistics warned that debt levels remain elevated, approaching the size of the entire U.K. economy. Healey, who recently resigned as Defence Secretary in protest over the government’s defense budget, emphasized the importance of fiscal control. “Fiscal control is the first duty of any” finance minister, he stated, adding that maintaining fiscal credibility is essential for both economic stability and national security. His comments followed a contentious departure from the previous administration, highlighting ongoing tensions within the government over economic priorities. U.K. financial markets remained relatively stable on July 21, though initial concerns had emerged ahead of Healey’s appointment as Chancellor of the Exchequer. Government bond yields rose slightly on Monday after Burnham suggested potential flexibility in adhering to the government’s balanced budget rules. Healey reassured investors that the government would work collaboratively to uphold fiscal rules while making everyday expenses more manageable for working people. Separately, official figures released on July 21 confirmed that the U.K. unemployment rate remained unchanged at 4.9 percent. While the economy has struggled to gain momentum since Labour regained power two years ago, the International Monetary Fund projects that the country will surpass many other advanced economies in performance this year. Burnham’s long-term vision includes reindustrializing the nation and accelerating the construction of municipal housing, aiming to create sustainable growth and improve living conditions for all citizens.