Belfast Telegraph

Business tax cuts see global slowdown

By Ben Chu

Despite George Osborne's claims that the UK must keep cutting business taxes to remain internationally competitive, a new report shows the global "race to the bottom" in levies on firms is actually slowing.

The global average Total Tax Rate – a broad measure of all businesses taxes – did slip again in 2012, but more slowly than in previous years. The global average rate in 2012 was 44.3%, down 0.3 percentage points on the previous year. But that was depressed by large changes in the Democratic Republic of Congo.

With that change stripped out, the global average total tax rate would have risen by 0.2 percentage points. That would have been the first rise in the tax burden since the survey began in 2004.

The findings are contained in a report by the accounting firm PwC and the World Bank.

The Coalition has sliced the rate for corporation tax from 28% to 24% since taking office in 2010.

The rate is set to drop to 20% in 2015, one of the lowest rates in the developed world. "There is still a huge amount to be done to make sure we are competitive vis-à-vis the rest of the world," the Chancellor said earlier this month.

Belfast Telegraph