Prime Minister Liz Truss has revealed that plans to increase corporation tax from 19% to 25% will still go ahead in a press conference on Friday (14 October).

The U-turn followed Truss firing Kwasi Kwarteng as Chancellor earlier on Friday, appointing Jeremy Hunt in his place.

The previous Chancellor, Rishi Sunak, originally put forward the increase in corporation tax but was set to be scrapped following Kwarteng's mini-budget on 23 September.

However, adverse market reactions to the mini-budget forced the Government to backtrack on some decisions in an effort to protect the economy.

Speaking at the press conference, the PM said raising corporation tax would raise £18 billion a year, which will "act as a downpayment" on the medium-term fiscal plan at the end of October.

Responding to the Prime Minister's statement, Shevan Haviland, director general of the BCC, said:

"The Prime Minister was right to take some action now. We have been calling for the Government to urgently address market volatility, return stability to the economy and give businesses some certainty to plan.

"Firms will always prefer a lighter tax burden, but they are most concerned about upfront costs, such as National Insurance Contributions and energy bills."

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