Prime Minister Boris Johnson has announced that the planned cuts to corporation tax are to be put on hold.
On 1st April 2020, corporation tax was due to fall from 19% to 17%. However, in the run up to the December general election, Conservative party leader Boris Johnson has announced that this cut to corporation tax is to be put on hold to help fund “other priorities”.
Johnson has said that the money that would have been spent on the cut, will instead be put into the NHS and other national services. An article on the BBC website, however, claims that the cut would not mean any additional money being spent on the NHS, instead it would be used to fund an existing pledge to GP training.
During the speech where Johnson made the announcement, he made a plea for business leaders to understand his decision, claiming that it was the “fiscally sensible thing to do” and would allow him to put £6bn into public services.
With the general election on the horizon, it’s thought that Johnson has made the decision to distance the conservative party from their image of being a party for big businesses and the wealthy.
At the same conference, Labour leader Jeremy Corbyn announced that he planned to raise corporation tax but promised that rates would be no higher than they were in 2010 when Labour were last in power.
Corbyn, who has been accused of being “anti-business”, justified his decision by saying: “It’s not anti-business to say that the largest corporations should pay their taxes just as smaller companies do.
“And it’s not anti-business to want prosperity in every part of our country – not only in the financial centres of the City of London.”
For help or advice regarding corporation tax, give our team of accountants here at Michael Bell and Co a call on 01484 690 730.