How a UK corporate tax rate of 15% would compare globally
Tax cuts dominate the proposals of Conservative Party leadership candidates hoping to succeed Boris Johnson as prime minister.
Two candidates, former Chancellor Sajid Javid and former Health Secretary Jeremy Hunt, have both pledged to cut the UK corporation tax rate from the current 19% to 15%. It would reverse former Chancellor Rishi Sunak’s plan to raise corporation tax to 25% by 2023.
UK business tax is already the lowest in the G20 and G7. In Germany, the combined statutory federal and local corporation tax rate is 30%, while in France it is 28%. In the United States, a federal corporate tax rate of 21% combined with various state taxes brings the rate to 26%.
Hunt and Javid’s plans are barely acceptable under the global minimum corporate tax rate of 15% agreed by the G20 last year. Ireland – which is not a member of the G20 or G7 – stands out with its low overall rate of 12.5%.
Other Tory leadership candidates, including Chancellor Nadhim Zahawi, Tom Tugendhat and Suella Braverman, have also sought to appeal to Tory MPs by promising tax cuts.
[See also: Boris Johnson was never truly popular as prime minister]
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