10-03-2008
Corporation tax should be simplified says shadow chancellor
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UK businesses could become more competitive if corporation tax were simplified, according to George Osborne.
The shadow chancellor, speaking on BBC One's The Andrew Marr Show, described the current corporation tax rate of 28 per cent as among the least competitive rates in the world.
"We live in a globalised economy where these businesses can either invest in Britain or they can go to China, or they can go to Ireland, just across the Irish Sea, where there is a 12.5 per cent rate," he said.
According to Mr Osborne, it is "extremely important" to have a low rate of corporation tax in order to attract jobs to the UK.
He said that in the present climate, there is no scope for business taxes to be cut significantly.
However, Mr Osborne believes the system should be simplified.
"Get rid of the very expensive reliefs and allowances that exist within the corporation tax system and use the money to cut the headline rate," he added.
Chancellor Alistair Darling is set to deliver his first Budget speech on Wednesday.