PM slashes plans for corporation tax cuts

Election 2019

 

Boris Johnson has promised to delay cuts to corporation tax in order to fund ‘priorities’ like the NHS. When addressing a CBI conference, Boris Johnson told business leaders the previously agreed tax cut from 19% to 17% would be put on hold on the grounds it would have cost the Treasury £6bn. Instead, he argued this money could be better spent rectifying current problems within the UK health system.

The tax had initially been introduced in 2016 by then-Chancellor George Osbourne in order to boost business in the wake of the Brexit referendum. Corporation tax is a vital revenue-raiser, contributing around 9% of the Government’s total tax take. However, there are some economists who believe that delaying the tax cut could prove counter-productive in terms of tax take, instead suggesting the delay could end up costing the Government £6bn a year.

Meanwhile, in his own pitch to the CBI Jeremy Corbyn argued businesses had ‘so much to gain’ from a Labour government, dismissing claims he was anti-business. He argued his proposals to increase corporation tax to 26% was ‘not an attack’ on the free market but policy that would put the UK in line with European counterparts.

Liberal Democrat leader, Jo Swinson, also had the opportunity to make her pitch business leaders claiming her party were the natural party of business because they were the only party who wanted to cancel Brexit.