George Osborne has pledged to cut corporation tax to 15 per cent in a move designed to give Britain a post-Brexit boost.
Cutting the rate of tax firms pay by 5% would hoist the “open for business” sign over the UK, the chancellor told the Financial Times in his first interview since the vote to leave the EU.
The cut would be one of five things Mr Osborne says the UK must do to galvanise the economy, which he said he wants to play a leading role in shaping as it heads to a Brexit.
But he also told the FT that the government should “get on with it;” refrain from “moping around and trying to unpick” the Brexit decision and should “make the most of the hand we’ve been dealt.”
If he gets his way, the chancellor would give the UK the lowest corporate tax rate of any major economy, but the rate would still be undercut by Ireland where it is 12.5 per cent.
The Taxpayers’ Alliance welcomed Mr Osborne’s pledge to slash the current 20 per cent tax rate for small firms, but indicated he should go further by not allowing Ireland to compete.
“The chancellor is absolutely right to be considering a big cut to corporation tax…but Mr Osborne must be bold and cut the rate to 10%,” the Alliance said.
The Labour shadow chancellor John McDonnell was much less enthused. “This is a futile and costly gesture from a lame-duck chancellor who is clean out of ideas,” he said.
“Instead of turning the whole country into a giant tax haven and playground for the ultra-rich, the chancellor needs to get a grip on the real problems by reversing planned cuts to government investment and bringing forward shovel-ready projects for those areas worst affected by the investment slump and the shock of Brexit.”
What do our speedy followers think about cutting corporation tax; would it turn the UK into a tax haven or be the vital boost a post Brexit Britain needs? Let us know your thoughts in the comments section below