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Thursday
Jul012010

Could New Corporation Tax Rate Help Investment in Business?

Lots of people have been talking recently about what we can expect from the first Budget from the new Chancellor George Osborne.  One thing I have noticed that keeps on coming up again and again is the possibility of a cut in the rate of Corporation Tax charged to eligible businesses.

As far as announcements are concerned we cannot yet be sure whether this will happen or not.  But the odds are now heavily weighted in its favour, especially as the Chancellor has announced that he intends to put in place a radical overhaul of the corporate tax system to make it one of the best in the G20 region.

The head of taxation at ACCA – the Association of Chartered Certified Accountants – thinks that a 25% rate of Corporation Tax could be crucial in inviting new investments into British businesses.  This will help to get us on the road to recovery far more quickly and make the UK a much more attractive place to come to with regard to new business investments.

Given the reports I have read recently on the corporate tax situation, I feel certain there will indeed be a forthcoming cut in the rate.  But it will be interesting to see how this rate is paid for by the Chancellor.  Some are concerned that he may give with one hand and take away with the other, and if this were to be the case then British businesses would not be in such a strong position after all.

While we wait to find out what the actual announcement will be, you can always consult us here at St Matthew to see whether your business is on the right track financially.

 



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