Brexit: On Corporation Tax and offshore UK
The Guardian has something to say about Corporation tax. If your company is based in the UK, it pays Corporation Tax on all its profits from the UK and abroad. The current rate is 19%. The Government is set to reduce it to 17% in 2020 – in line with Singapore, which just pulled Sir James Dyson. Because the tax based on companies’ profits this dynamic tax (one that responds very swiftly to change) is very difficult to forecast. But the Guardian is clueless about how it works:
Corporation tax receipts have increased since the financial crisis, although profits of firms have risen as the economy has recovered
“Although”?! No. Tax is up BECAUSE profits are up. That’s how Corporation Tax works. It also doesn’t work in isolation. There are other taxes, such as the banking levy. And economic growth leads to higher profits and thus higher levels of tax receipts. Of course, in the current political climate making any forecasts on company profits is set in water.
Posted: 28th, January 2019 | In: Money, News Comment | TrackBack | Permalink
