Exorbitant corporate taxes forcing companies out of UK: CBI |
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Tue, 10 Oct 2006 10:10
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LONDON - The high level of corporate taxes prevalent in the country is forcing a number of multi-national firms to leave UK shores, the Confederation of British Industry said. The CBI added that ever since the Labour assumed power taxes on firms had registered an increase of a whopping 59 billion pounds.
If this trend continued, then the UK risked losing valuable businesses to the Republic of Ireland and similar countries where the tax burden was low. "Current corporate tax levels are unsustainable until companies start generating more revenues outside the UK, or corporation tax must come down," CBI Director General Richard Lambert told at a press meet on Tuesday. "There will have to be some changes in the near term."
Mr Lambert added that at 30 percent, the UK corporation tax rate was uncompetitive when compared to the 12.5 percent in the Republic of Ireland. "Either companies will generate more revenue outside the UK or corporation tax has to come down," Mr Lambert said, adding that a trickle of companies were already relocating and that the CBI's concern was that this trickle must not turn into a flood.
Another problem, according to the CBI, is that HM Revenue & Customs is pushing aggressively in order to collect the taxes owed. "Compared to the rest of Europe the burden of taxation is rising in the UK at the same time as tax collection has become noticeably more aggressive," Lambert said.
The CBI said the government must take steps to ensure that the public received good value for the £150 billion spent on goods and services. More often civil servants were inexperienced and were not able to deal with the issues involved, the CBI stressed.
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