Out of touch Chancellor Kwasi Kwarteng was forced to perform an embarrassing u-turn over his tax cut for the UK's highest earners after it caused widespread outrage.
Mr Kwarteng and PM Liz Truss - who insiders say may be ousted by the end of the year - finally relented to growing pressure after Tory MPs broke ranks.
In a statement posted on his Twitter feed, the Chancellor said: "We get it, and we have listened."
And the Prime Minister also shared a statement saying that the 45% rate had "become a distraction from our mission to get Britain moving".
Party heavyweights Michael Gove and Grant Shapps are among those who spoke out, with the latter branding the tax cut for the rich "tin eared".
Ms Truss tweeted: "We get it and we have listened. The abolition of the 45% rate had become a distraction from our mission to get Britain moving.
"Our focus now is on building a high growth economy that funds world-class public services, boosts wages, and creates opportunities across the country."
The cut in tax from 45% to 40% on earnings over £150,000 would have cost £2bn a year and handed a £10,000-a-head average saving annually to 660,000 very wealthy people.
Following the announcement Mr Kwarteng refused to apologise for the mayhem he had caused, instead telling BBC Radio 4's Today programme: "There's humiliation and contrition and I'm happy to own it."
But he said he had "not at all" considered resigning despite scrapping a key part of the financial plans he set out on September 23.
He also said that a new era of austerity could be on the way to pay for tax cuts, stating: "You will see what our spending plans are in the medium-term fiscal plan but I'm not going to be drawn into that."
The Chancellor as the screeching U-turn was "not about parliamentary games or votes in the House of Commons" but about "getting people behind the measure", Chancellor Kwasi Kwarteng said.
Asked if the policy is still the right thing to do or whether he is scrapping the plan because he cannot get it through, Mr Kwarteng said: "It's not a question of getting it through, it's a question of actually getting people behind the measure. It's not about parliamentary games or votes in the House of Commons.
"It's about listening to people, listening to constituents, who have expressed very strong views about this, and on balance I thought it was the right thing not to proceed."
Asked about Prime Minister Liz Truss saying on Sunday morning that she was going ahead with the plan, and explaining the timing, Mr Kwarteng said: "We get it. I get it. I saw the reaction. I saw the focus, the intense focus on that particular measure."
Asked why he did not listen to the reaction on Saturday, he said: "We were absorbing the reaction and we were thinking 'What are we going to do?"'
He stressed that the 45p rate "was one element of a very comprehensive plan" and said it "even fiscally wasn't the most significant by any means".
Mr Kwarteng's statement in full
"From supporting British business to lowering the tax burden for the lowest paid, our Growth Plan sets out a new approach to build a more prosperous economy.
"However, it is clear that the abolition of the 45p tax rate has become a distraction from our overriding mission to tackle the challenges facing our country.
"As a result, I'm announcing we are not proceeding with the abolition of the 45p tax rate. We get it, and we have listened.
"This will allow us to focus on delivering the major parts of our growth package.
First, our Energy Price Guarantee, which will support households and businesses with their energy bills.
Second, cutting taxes to put money back in the pockets of 30 million hard-working people and grow our economy.
Third, driving supply side reforms - including accelerating major infrastructure projects - to get Britain moving.
