U.K.’s Sunak Mulls Emergency Cut in Value-Added Tax, Times Says

U.K. Chancellor of the Exchequer Rishi Sunak is mulling an emergency cut to the country’s value-added tax, The Sunday Times reported.

Sunak has asked officials to prepare various options to lower the sales tax, including reducing the headline rate and zero rating more products for a fixed term, the report said. He could make the announcement in a speech scheduled in early July.

The move comes as U.K. government debt rose above 100% of gross domestic product in May for the first time since 1963, reflecting a sharp drop in economic output. Prime Minister Boris Johnson has said the government is looking at various ways to help the country recover from the Covid-19 fallout and “bounce forward.”

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