A planned rise in corporation tax is set to blow a £67billion hole in UK business budgets and bosses fear it could tip the economy into recession.
The increase from 19% to 25% from next April will bring the levy to its highest level since 1989.
Blow: Some have argued that corporation tax should be cut – perhaps as low as 12.5% - rather than increased
The ‘damaging’ increase, revealed in figures from the Office for Budget Responsibility, was fiercely opposed by hotelier Sir Rocco Forte, investment guru Sir Paul Marshall, pub boss Tim Martin, tycoon advertising Sir Martin Sorrell, former NatWest chairman Sir Philip Hampton and ex-Pizza Express boss Hugh Osmond.
Some have argued that the tax should be reduced – perhaps as low as 12.5% – rather than increased.
A reduction would attract more foreign investment and give the economy a vital boost, helping to prevent growth from stagnating and inflation from spiraling out of control.
The huge sum that would be raised by the proposed hike dwarfs even the £47billion that Chancellor Rishi Sunak expects to receive from freezing income tax thresholds over the next five years.
:quality(70)/cloudfront-eu-central-1.images.arcpublishing.com/irishtimes/6D3PQFR4HASJYP5NYJXVM66GAM.jpg)
