Britain’s New Leader Orders Cut in Taxes on Electricity

Prime Minister Andy Burnham of Britain announced on Tuesday the elimination of value added taxes on electricity, saying that the change would save households the equivalent of about $60 this year at a time of volatile energy costs.

The move, coming on Mr. Burnham’s second day in office, seemed intended to demonstrate his commitment to tackling high prices in Britain. That issue was central to the anger and frustration that many people cited when asked about Mr. Burnham’s predecessor, Keir Starmer, who announced his resignation last month.

In a statement, Mr. Burnham said that he wanted “to give people breathing space.”

“We’re taking immediate action to cut taxes on energy bills, put more money in people’s pockets and bring back hope,” he added.

Even as Mr. Burnham tries to address concerns about inflation, he is under pressure from the bond market not to add to Britain’s public debt. Political opponents have already accused him of wanting to raise taxes to pay for new government spending.

Aides said on Tuesday that the cut in electricity taxes would be paid for by scrapping Mr. Starmer’s plan to create a national digital ID card. They said the government would save about $2.4 billion by abandoning the idea, which was devised to curb illegal migration.

But Darren Jones, one of Mr. Starmer’s top allies who was fired from the cabinet by Mr. Burnham on Monday, wrote on social media on Tuesday that the digital ID program was “unfunded.”

“The government will have to set out how it will pay for its new policies at the budget,” he wrote.

Mr. Burnham’s announcement on electricity tax cuts came as he received a glowing initial assessment from President Trump in a late-night social media post, after the two leaders had a brief telephone conversation earlier in the day.

“The Prime Minister has got a big job ahead of him, but he will be able to do it and, of course, the U.S.A. will be there to help!” Mr. Trump wrote on Truth Social. “The call was interesting, and went very well. I wished Prime Minister Burnham, GOOD LUCK AND GODSPEED!”

Dealing with Mr. Trump and managing the relationship with the United States will be a key challenge for Mr. Burnham. In a recent interview, the British prime minister said that he would try to be himself when dealing with Mr. Trump and that he would meet the U.S. president “where he’s at.”

Mr. Burnham also made a flurry of appointments to his cabinet late into the night on Monday.

Wes Streeting, who had been the health secretary under Mr. Starmer and briefly considered challenging Mr. Burnham for the leadership of the Labour Party, will become defense secretary. Ed Miliband, former energy secretary, will lead the Foreign Office. Shabana Mahmood will stay as home secretary.

Perhaps the most surprising staffing move was Mr. Burnham’s decision to make John Healey, former defense secretary, the chancellor of the Exchequer, Britain’s top financial official.

Mr. Healey resigned from his defense post last month, telling Mr. Starmer in a resignation letter that Rachel Reeves, who was then the chancellor, was not spending enough money on the military. Now Mr. Healey has replaced Ms. Reeves and is in a position to change the direction of spending.