British Prime Minister Liz Truss on Friday announced another U-turn in her government's tax-cut plan, in an effort to reassure financial markets.

She has confirmed that corporation tax will rise to 25 percent from 19 percent in a major policy U-turn, adding that this will raise 18 billion pounds in taxes for the country.

"It is clear that parts of our mini-budget went further and faster than markets were expecting, so the way we are delivering our mission now has to change," she said at a press conference.

It is the second reversal of a "mini-budget" policy after the government decided not to scrap the 45 percent highest income tax threshold.