If Biden removes his corporate tax hike, should we too

In much of the rest of the world, it is quite possible that the “overall minimum” of 15 pc will become a de facto standard, a standard that everyone will gradually adopt.

From being in the mainstream, the UK has become the outlier. All the other big economies cut rates or keep them stable. Only Great Britain is increasing corporate taxes, and at a dramatic rate.

Okay, that’s bold, and it’s different. The problem is, it’s so crazy. The truth is, the UK cannot afford to be so remote and uncompetitive in the way it taxes big business.

For 40 years, we have had a relatively weak tax economy for businesses. Very soon we will be taxed high. Think of Sweden or Germany, but with rotten infrastructure. It just won’t work.

We must not kid ourselves that we are hyper-competitive. Our roads and airports are poor, the skills base is poor, we have labor shortages everywhere, the cost of housing is penalizing and we are no longer part of the single market. Low taxes have made up for a large part of this. Without them, we don’t necessarily have much to offer to a multinational looking for a European hub.

If Biden cancels his corporate tax hike, as now seems inevitable, Sunak would have to be old enough to admit that the world situation has changed.

There is no shame in it. Everyone understands that large businesses are mobile, that they can move from place to place, and that tax rates make a difference. If we are far removed from the rest of the world, we will pay a heavy price in lost investments and lost jobs.

The tax hike may have looked acceptable in March. He seems reckless in October. The Chancellor would have to admit it and reverse the planned increase before it does any real damage.