UK scraps tax cut for wealthy that sparked market turmoil

By JILL LAWLESS
Associated Press

BIRMINGHAM, England (AP) — The British government has dropped plans to cut income tax for top earners. The move was part of a package of unfunded cuts that sparked turmoil on financial markets and sent the pound to record lows. Treasury chief Kwasi Kwarteng said Monday that he would abandon plans to scrap the top 45% rate of income tax paid on earnings above 150,000 pounds a year. The announcement comes as more lawmakers from the governing Conservative Party turn on government tax plans. The announcement of 45 billion pounds in tax cuts sent the pound tumbling to a record low against the dollar. The Bank of England had to step in to stabilize the bond markets.