Post-Brexit UK will not slash taxes: finance minister

Britain will not cut tax and regulations after Brexit in an attempt to undercut its European rivals, finance minister Philip Hammond has said, after previously threatening to do just that.

Britain's Chancellor of the Exchequer, Philip Hammond said Britain's economic, social and cultural model would remain "recognisably European" after it left the European Union
Britain's Chancellor of the Exchequer, Philip Hammond said Britain's economic, social and cultural model would remain "recognisably European" after it left the European Union (AFP)

Britain will not cut tax and regulations after Brexit in an attempt to undercut its European rivals, finance minister Philip Hammond has said, after previously threatening to do just that.

Hammond said Britain's economic, social and cultural model would remain "recognisably European" after it left the European Union.

His comments to French newspaper Le Monde appear to rule out Britain slashing corporate tax to attract global businesses.

It marks a change of tone after Hammond suggested in January that Britain could become a Singapore-style tax destination if other EU nations blocked access to Europe's single market.

Hammond, the chancellor of the exchequer, told Le Monde: "I often hear it said that the UK is considering participating in unfair competition in regulation and tax.

"That is neither our plan nor our vision for the future. The amount of tax we raise as a percentage of our GDP puts us right in the middle of the pack.

"We don't want that to change, even after we've left the EU."

In January, Hammond told German newspaper Welt am Sonntag that he was optimistic that Britain would negotiate a good trade deal with the EU but if it did not secure a deal, "you can be sure we will do whatever we have to do".

In the Le Monde interview, Hammond said: "I would expect us to remain a country with a social, economic and cultural model that is recognisably European."

He also said Britain wanted workers from the EU to continue to work in Britain and have a family life there after Brexit and "vice versa" for British citizens to be allowed to continue living in the EU.

By stressing the need for lengthy transitional arrangements with the EU, Hammond has placed himself at odds with cabinet colleagues who want a clean break from the bloc under a so-called hard Brexit.