Business leaders and economists have warned that Jeremy Hunt’s tax plans could hinder a potential economic recovery, saying the Chancellor’s upcoming increase in corporation tax will hold back growth. Jagjit Chadha, director of the National Institute of Economic and Social Research, said the tax rise will “act as an ongoing drag on the economy,” adding: “Business investment is much lower than it should be and an increase in corporation tax is not going to help it recover."
Martin Beck of the EY Item Club commented: “Just as things are looking better, they're going to raise corporation tax and get rid of the super deduction. Public finances have improved, so is it really necessary?" He added: “Corporation taxes are paid by a combination of workers through lower wages, customers through higher prices and shareholders through lower dividends, so we'll all feel the pain somehow."
Former Depop CEO Runar Reistrup, chief executive of freelancer platform YunoJuno, said: "If I was a starting a business I would think twice before basing it in the UK with the tax rise. It will hurt the UK's ability to produce future tech unicorns." Meanwhile, Rolls-Royce and BAE Systems have added their voices to those calling on the Chancellor to scrap a planned hike in corporation tax, from 19% to 25%.
Read more: Daily Mail
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