We must not surrender tax rights, say MPs

JEREMY HUNT has been accused of undermining Brexit by agreeing to international corporation tax rules as he faces a fresh backbench rebellion ahead of the Budget.

A group of prominent Conservative MPs, led by Liz Truss, the former prime minister, and Priti Patel, the ex-Cabinet minister, have warned the Chancellor not to “rush ahead and surrender sovereign tax rights”. It is the latest sign of Tory unrest ahead of the Budget, with Mr Hunt under pressure to abandon his corporation tax rise from 19 to 25 per cent.

Last night Mr Hunt told The Sunday Telegraph that the Government is “taking any steps we can afford to make it easier for businesses to invest”.

In a letter to the Chancellor, the MPs are urging him to pull out of an international agreement that corporation tax should never be below 15 per cent. They say that there was little point withdrawing from the EU if the Government was going to ratify the agreement brokered last year by the Paris-based Organisation for Economic Co-operation and Development (OECD).

“As a party elected to ensure Britain ‘Takes Back Control’, it is remarkable that we should be asked to rush ahead and surrender sovereign tax rights under the OECD initiative, especially while so many questions about the measure remain unaddressed,” they said. “We risk damaging UK economic competitiveness by pressing ahead with the current implementation timeline.”

The letter, also signed by Greg Smith MP and Stephen Hammond MP, points out that other countries are dragging their feet when it comes to implementing the 15 per cent corporation tax floor.