Liz Truss pledges to review all taxes as she defends bankers' bonuses

The Prime Minister’s comments, made on her first foreign trip to the US since taking office, could see a radical shake-up of the UK’s tax system.

Ms Truss confirmed she will be reversing the national insurance hike and axing the planned rise in corporation tax.

“We have to look at our tax rates. So corporation tax needs to be competitive with other countries so that we can attract that investment,” she told the BBC.

She also said she was “absolutely prepared” to see bankers get bigger bonuses if it led to economic growth.

"What I want to see is a growing economy," Ms Truss said.

"If that means taking difficult decisions which are going to help Britain become more competitive, help Britain become more attractive, help more investment flow into our country, yes, I'm absolutely prepared to make those decisions."

Ms Truss conceded that her choices may make her an unpopular Prime Minister.

Asked during a round of broadcast interviews on the 102nd-floor observatory of the Empire State Building if she is prepared to be unpopular, she said: “Yes. Yes, I am.”

“What is important to me is we grow the British economy because that’s what will ultimately deliver higher wages, more investment in towns and cities across the country. That’s what will ultimately deliver more money to people’s pockets.

“In order to get that economic growth, Britain has to be competitive. If we put up taxes, if we have arbitrary taxes on energy companies, if we have high corporation tax, we’re not going to get that investment and growth…”

She insisted the cost to the taxpayer of her energy package, being paid for by borrowing rather than a windfall tax on the profits of energy and oil giants, is “not what has been projected”, with estimates as high as £150 billion.

However, Ms Truss received criticism from international allies and MPs ahead of the Chancellor’s mini-budget on Friday.