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Corporation tax small part of business yield

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31st Jan 2014
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The UK’s largest businesses paid £77.6bn in tax last year, although just £6bn was paid in corporation tax, according to PwC

PwC’s 100 Group Total Tax & Economic Impact Survey revealed taxes paid increased by 11% since 2005 when the study started, while CT has continued to decline by 40%.

The £0.5bn increase, up from £77.1bn, is mostly down to higher employment taxes, VAT and excise duties, PwC said.

The proportion made up by CT continues to decline, and the total amount of CT paid by 100 Group companies declined from £8bn to £6bn, due to both reduced profits and a lower tax rate.

Robin Freestone, chairman of the 100 Group, said: “Government’s rebalancing of business taxes away from corporation tax appears to have played a role in helping to incentivise increased levels of UK employment, as well as investment and research and development.

“These are now helping to stimulate UK economic activity and growth. The best barometer for FTSE large cap business's economic and tax contribution in the UK is this survey and it's also is an important part of the 100 Group’s commitment to tax transparency.”

Employers’ National Insurance Contributions (NICs) also made up the largest amount of business tax costs at 27.5%.

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By KWest
05th Feb 2014 13:38

Stimulating Economic Activity?

The first to "stimulate UK economic activity and growth" are the SMEs. Up until 2006 they were paying 19% corporation tax with marginal relief for profits between £50K and £300K. They are now paying 20% with no marginal relief. If the Treasury really are concerned about "stimulating" economic growth it would be better if they were to lower the tax and while they're at it - reintroduce the 10% tax rate for profits not exceeding £10K that Brown scrapped in 2005 during one of his barrel scraping budgets.

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