Corporation to tax to rise to 25 per cent

I am no Conservative supporter but do you recall the party’s aim to reduce it from 19 to 12 per cent? I think it is fair to say that is a bit of a shocker.

What I definitely remember is that the reductions in corporation tax went hand in hand with substantial increases in dividend taxation. 

25% CT followed by 38% IT on dividends is too much. 

like fook

this is a Rishi PR stunt

he's throwing the dice on his measures this year and next year getting some growth and come 2023 he's going to drop it or postpone it because he's done so well with the economy 


The last set of reductions to CT was in Osborne's 2015 summer budget, alongside the reforms to dividend taxation, including the new 38.1% top rate.

It’s tax on profit 

if you’re doing well it’s kind of fair enough 

Especially as there’s a lower rate for less profitable and/or small companies.  

Yeah I'm struggling to see the problem.

Still lower than any other big country, except Italy but think they are raising theirs too.

There was an increase in dividend tax after reduction in corporation tax, I remember that.


As someone who relies on divis for 90% or more of their income, I do find it hard to argue against this one. All in it together and all that. If there'd been an NIC bumming for contractors using PSCs I'd probably think differently. 

I'm not arguing against this

I'm saying that I don't believe this will happen 

"lower than any big country" is a bit of a red herring I think. For large corps the issue is effective tax rate and when you can't get out of carrying a 40% burden in India/China because goods won't travel on paper like they do in europe and you're locked into local manufacturing deals you need low tax rate in your head office/ internal sales set up to get that the group tax rate down to something the shareholders can live with 

Sunak asked in radio whether tories still believed raising corporation tax reduced tax take as they repeatedly stated before - tumbleweed than answered different question - heh

@Buzz - is it still worth taking top slice of income as divis once CT goes to 25% ? I haven't run the numbers yet but the benefit was already getting quite slim when dividend tax rates went up.

@Guy - that was a great question this morning. Rishi doesn't really do theory - guess it isn't consistent with the brand.

I also think he won't increase CT to 25% in 2 years time, he'll claim his excellent stewardship has allowed him not to.

If the super-deduction goes well, I wonder f it will be temporary. Who wants to be the chancellor who increases taxes on productivity and investments 


Depends what you mean by productivity, Rubbo.

Profitability does not necessarily = productivity or investment.

25% CT rate waters down the heat behind IR35 legislation which is a plus