Emergency Budget: comment from the tax bar on business taxes

Jonathan Peacock QC

A common reaction to the March 2010 Budget was one of disappointment that the then Chancellor failed to grapple with either the fiscal deficit or the UK’s slide towards an unattractive and uncompetitive tax regime. The former criticism certainly cannot be made of the new Chancellor but what of the latter?

The initial signs are moderately encouraging. We have clear recognition at last that high rates of tax (together with the sheer complexity of the corporate tax code) continue to drive businesses out of the UK. The rates of tax are to be addressed by gradual reductions in the headline rate over the period 2011-2014 (matched by a one-off cut in the small company rate and perhaps countervailing reductions in the rate of capital allowances) and we are told the complexity of the system will be addressed over the coming years through...

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