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Britain's coalition government has unveiled an emergency budget in a bid to rein in record government debt. The new government's first budget included sweeping cuts to public spending and new tax hikes. While businesses will benefit from a corporation tax cut, most of the pain will fall on British citizens.
It had been hailed as the toughest belt tightening exercise in the UK since the war - and the doom mongers weren't wrong ...
Tuesday's emergency budget in the UK, designed to tackle a massive fiscal deficit, saw a slash and burn attack on benefits and the public sector balanced with tax hikes and pay freezes.
Finance minister George Osborne had promised in previous weeks he meant to take the UK's finances by storm, to rein in a budget deficit running at 11 per cent of national output - not far behind crisis hit Greece.
George Osborne said, "This is the unavoidable budget. I am not going to hide hard choices from the British people or bury them in the small print of the budget document."
In a bid to cut the deficit to almost nothing in five years Osborne aimed to pull in three quarters of the fiscal tightening from spending cuts and the rest from tax rises.
Government spending is set to fall by 25 per cent over four years, the VAT sales tax will go up to 20 per cent from 17.5 per cent, public sector pay has been frozen for two years and a tax on banks is expected to cost the industry - which many blame for the crisis- about 2 billion pounds.