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Britain's Chancellor of the Exchequer, Kwasi Kwarteng, says he has resigned after Prime Minister Liz Truss asked him to stand aside.
Key points:
- Kwasi Kwarteng was asked to resign as Chancellor of the Exchequer by PM Liz Truss
- He will be replaced by former foreign secretary Jeremy Hunt
- Mr Kwarteng was the UK's shortest-serving chancellor since 1970
"You have asked me to stand aside as your chancellor. I have accepted," Mr Kwarteng said in his resignation letter to Ms Truss, which he published on Twitter.
His replacement will be former foreign secretary Jeremy Hunt, who was one of Ms Truss's rivals in the last Conservative Party leadership contest.
Mr Kwarteng's resignation came shortly before Ms Truss announced she was scrapping parts of his economic package in a bid to survive the market and political turmoil gripping the country.
During a press conference at Downing Street, Ms Truss said Britain's corporation tax will rise to 25 per cent, a U-turn from the former chancellor's mini-budget from late last month, which had capped it at 19 per cent.
It was one of Ms Truss's key promises during her leadership campaign.
"We need to act now to reassure the markets of our fiscal discipline," she said.
Earlier Ms Truss, who has only been in power for 37 days, said Mr Kwarteng had "put the national interest first" by standing down.
"I deeply respect the decision you have taken today," she said in a letter to Mr Kwarteng.
"I know that you will continue to support the mission that we share to deliver a low-tax, high-wage, high-growth economy."
Opposition Leader Sir Keir Starmer said Ms Truss's performance as prime minister has "undermined Britain's standing on the world stage".
"Changing the Chancellor doesn't undo the damage made in Downing Street," he tweeted.
Kwarteng lasts just over a month as chancellor
Mr Kwarteng has become Britain's shortest-serving chancellor since 1970, and his successor would be the country's fourth finance minister in as many months.
He had announced a new fiscal policy on September 23, delivering Ms Truss's vision for vast tax cuts and deregulation to try to shock the economy out of years of stagnant growth.
On Thursday, Mr Kwarteng had denied he was about to lose his job, saying "I'm not going anywhere", before he was forced to rush back to London on Friday from IMF meetings in Washington to address the chaos.
Ms Truss has been under intense pressure to scrap some of the 43 billion pounds ($77 billion) in unfunded tax cuts that roiled financial markets and led the Bank of England to step in to prevent a wider economic crisis.
Mr Kwarteng's resignation came as Conservative politicians agonised over whether to try to oust their second leader this year.
Ms Truss was elected last month to replace Boris Johnson, who was forced out in July.
Some reports suggest senior Conservatives are plotting to replace Mr Truss with a joint ticket of Rishi Sunak and Penny Mordaunt, her two closest rivals in the summer contest for the party leadership, though it's unclear how that could be achieved.
ABC/wires