LETTER: Introduce tiered corporation tax
The argument is that having competitive taxes also keeps large businesses in the UK as well as helping small businesses.
Much of large and global businesses in the UK are now foreign owned (some by foreign countries) – railways, energy, cars, even supermarkets now.
So their profit after tax is often sent abroad to no advantage to the UK. This does assume these large companies are pursued to pay their full UK taxes. Obviously those employed in the UK by foreign companies earn taxable money which is spent in this country, so some advantages remain.
So, as long as taxes are reduced, not pursued, or large profits are hidden in tax havens, our UK services of every type and level will continue to deteriorate.
A cynic might suggest if the government continues to reduce taxes and not pursue global companies for taxes due or avoided, we the electorate will grab with open arms any option offered to us, to bring public services back up to our acceptable standards. This I suggest may be total privatisation, for example insurance based health services, total sale of our UK railway system – we only ‘hire them out through ‘franchises’ or in the case of ‘Southern’, a management contract.
We have all sampled the advantages of ‘competition’, ‘choice’ and ‘professional , business lead public services’ – energy, rail travel, road repairs, probation service, prisons, benefit assessments, ambulance services, water supply (choice, competition?).
It is not working for us, the general public, is it? So why is this ideology continued? Who is benefiting from these policies?
Watch this space for ‘fracking’, since we have already lost ‘fuel security’ to which our government often refers. Most of our power stations and many of our ‘energy companies’ etc. are wholly owned by French and Chinese companies.
As you probably know corporation tax is the UK’s tax on company profits in the UK. A bit like our own individual ‘income tax’ (20 per cent and 40/45 per cent).
Our government has reduced this corporation tax from above 20 per cent year by year to currently, 17 per cent uniformly across the broad spectrum of small to global businesses. They claim this is to protect small businesses and they plan to reduce this further.
So, here’s an idea – why not have a tiered corporation tax – like we, the electorate, have to pay? How about having a low tax for small companies with a small profit and a larger one for big or global companies with much larger profits. As small companies succeed and become bigger with larger taxable profit they also would slide into the higher tax bracket.
Oh no, this will discourage larger companies – well it doesn’t discourage individuals from taking higher earning jobs and (if we are lucky) they pay higher taxes. The idea that those responsible for the 2008/9 world financial crisis might threaten to leave London for Hong Kong etc, or those global companies who don’t pay UK taxes would leave, might just be a good thing.
My corporation tiered tax idea might also mean, that globalisation might just be slowed down a bit – as huge companies would pay more per cent tax than smaller ones. However, honest annual accounts from ‘globals’ is probably only a dream.
Finally, the times we hear of large or global companies threatening to leave the UK on every occasion any government plans a change (to the advantage of the electorate) that affects their company. Well, they don’t leave the UK do they?
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