Leading Tory MP warns that raising Chancellor Rishi Sunak’s corporate tax will “destroy jobs” and make Britain one of the most taxable countries in the Western world
Risha Sunaka’s corporate tax increase will “destroy jobs” and make Britain one of the most taxable countries in the Western world, a leading Tory MP warned.
Conservative MP John Redwood has called on the chancellor to abandon the policy, adding that it could lead the country to a recession.
Top accountants and economists reiterated his warning, stressing that the consequences could be serious.
Request: Conservative MP John Redwood has called on Chancellor Rishi Sunak to refrain from raising corporate taxes, adding that it could lead the country to a recession
The levy will be introduced in April next year, and the corporate tax will increase by 6 percent from 19 to 25 percent.
Redwood told the Daily Mail: “Higher taxes will bring him less income. They will force it to slow growth or recession, damage British business and destroy jobs.
“This is bad politics in the worst of times. This will turn off investment when people are worried about a recession and the money to raise is less.
“I urged the chancellor not to raise national insurance – the tax on jobs – or the tax on corporations, because you will have less income and investment, and not raise taxes in general because you will have slower growth.”
Redwood’s comments appear when research shows that raising taxes will make the UK one of the world’s hardest places to do business.
Accountants from UHY said the UK would drop 16 places in its income tax table – from one of the most competitive countries to lower than the world average.
The UK will be close to France and below average European and world tax rates. It will also sink below Vietnam and Egypt.
UHY Hacker Young tax chief Andrew Snowden said: “These taxes could lead investors to question the UK as a place to shop.”
A report released today says the increase, including an increase in national insurance, will damage Britain’s reputation as a low-tax environment.
This is happening at a time when businesses are feeling the brunt of rising prices, and consumers are looking for ways to tighten their belts.
Matthew Lesch from the think tank of the Institute of Economic Affairs said: “Raising the corporate tax will make the UK less attractive. They must cancel the planned increase in corporate tax [and] replace ‘super-deduction’. ‘
A Treasury spokesman said: “We had to make tough but responsible decisions to restore public finances.”