CBI chief blasts Sunak tax plan
RISE ‘WRONG’ AS FIRMS FACE CLIFF EDGE
BUSINESS lobby group the CBI is on a potential collision course with the Government over tax rises.
Reports say Chancellor Rishi Sunak is drawing up plans to hike corporation tax in his March budget to help tackle a Covid-fuelled surge in public debt.
But Tony Danker, CBI director general, warned: “It would be wrong to raise business taxes when we don’t have a recovery.”
He said it would undermine the huge support put in place for firms during the pandemic.
However, companies are likely to come under pressure to shoulder their share of any tax rises announced by the Chancellor in the Budget on March 3.
Corporation tax has fallen from 28% to 19% over the past decade.
Boris Johnson scrapped plans to cut it to 17% in 2020 in one of his first acts as Prime Minister. Meanwhile the CBI has called for the Chancellor to confirm an extension to coronavirus help for firms well ahead of the Budget in spring. They include shifting the end date for the Job Retention Scheme – a key plank of the Treasury’s Covid response – to June, followed by targeted help. The CBI also wants a threemonth extension to the deferral on VAT payment and business rates holiday. Danker warned that a “cliff edge of financial support” was looming. He went on: “Almost a year of disrupted demand and extensive restrictions to company operations is taking its toll.” The CBI has admitted its own package of recovery measures and other reforms would cost almost £18billion.