Patel in call for Hunt to pause tax rise plan

FORMER home secretary Priti Patel has urged the Chancellor to use his Budget next month to halt the planned corporation tax rise.

The senior Conservative has argued that “now is not the time” for an increase in the tax on big business.

In plans agreed while she served in Boris Johnson’s cabinet, corporation tax is due to rise from 19% to 25% in April.

Ms Patel has also called on Chancellor Jeremy Hunt to pull out of an international agreement preventing corporation tax from falling below 15%.

Britain was signed-up to the deal by Prime Minister Rishi Sunak when he was chancellor, in a move brokered by the Organisation for Economic Cooperation and Development (OECD).

Mr Sunak, announcing the deal in October 2021 when Ms Patel was home secretary, said it would lead to a “fairer tax system, where large global players pay their fair share wherever they do business”.

Speaking to the Daily Telegraph, Ms Patel said: “It is not too late for the Chancellor to back business and end the current political obsession of regulation, high taxes and interference with business.

“The Chancellor must send a positive signal to business in the Budget which supports jobs and economic growth. Now is not the time for an increase in corporation tax.

“Just like the issue of the OECD agreement, everything needs to be paused for the benefit of businesses around the country,” she added.

Mr Hunt is due to give his spring Budget on March 15.

The Chancellor is under pressure from the right of his party to slash taxes ahead of the next election in a bid to revive the UK’s stalling economy, which only narrowly avoided falling into recession last year.

Former prime ministers Mr Johnson and Liz Truss are among those advocating cuts.

Earlier this week, Mr Hunt appeared to rule out changing course on taxes after being handed a surprise monthly surplus in January thanks in part to lower public borrowing than forecast.

The Office for National Statistics revealed that the UK Government reported a surplus – when tax revenue received is larger than government spending – of £5.4bn, driven by record returns from self-assessed income tax.