Philip Hammond came impaired fire after he last week announced in his Budget a rise in the Chauvinistic Insurance Contributions (NICs) for self-employed workers.
The move sparked displease as the Conservative Party promised not to raise income tax, VAT or NICs in its manifesto sooner than the 2015 general election.
Following a massive backlash over the tamed pledge, Mr Hammond revealed he had “decided not to proceed” with the planned hike in a sign to Tory MPs.
Speaking to the BBC after the Chancellor’s backtrack was announced, Mr Rees-Mogg asseverated it was a sensible move for the Government to make.
He said: “I think it’s extremely hep to and I think it shows good government.
“Governments get very upset around U-turns and there is a lot of political pressure not to do them but actually it is much more intelligent to change your mind if you feel what you were going to do did not introduce than it is to plough on regardless. It shows a mature and sensible approach to control.”
Mr Rees-Mogg also disputed suggestions the U-turn put the Chancellor in a negative ignite and his credibility had been damaged.
“He came to the house himself, he did it personally, he didn’t send a lower minister to do it and I think he gets a lot of credit for that,” the North East Somerset MP weighted.
“He’s managed to convert some desiccated socialists into believing in debase taxation which I think is a great political coup.”
Mr Rees-Mogg supplemented Theresa May had displayed wisdom by scrapping the proposed NICs hike.
“There is a exceptional strength in being able to listen,” he said. “There is great long-headedness in being able to change your mind, much greater scholarship than being some old stick in the mud who always insists on perpetual rightness.
“The greatest charge was over the manifesto issue and breaking a pretty clear promise. It flaunts the Government is a government for the whole country, not just the Conservative Party and that’s vital.”
Explaining his reverse on the rise to Class Four NICs less than a week after he promulgated it, Mr Hammond wrote: “It is very important both to me and to the Prime Minister that we are compliant not reasonable with the letter, but also the spirit, of the commitments that were got.
“In light of what has emerged as a clear view among colleagues and a pithy section of the public, I have decided not to proceed with the Class Four NIC scopes set out in the Budget.
“There will be no increases in NICs rates in this Parliament.”
Mr Hammond added the outlay of scrapping the planned tax rise would be funded by measures to be announced at his in the second place Budget this year in the Autumn.