Chancellor Philip Hammond says the Government will stick to the business tax roadmap set out in the March budget that will see corporation tax cut to 17 per cent.
He says: “My priority as Chancellor is to ensure that Britain remains the number one destination for business – creating the investment, the jobs and the prosperity to protect our long-term future.”
Hammond says the tax rate of 17 per cent will be “by far” the lowest in the G20.
He pointed out that the Government has already cut tax from 28 per cent to 20 per cent since 2010, which he says sends the message that “Britain is open for business”.
Investment in productivity and infrastructure in today’s statement underscores that message, Hammond said.
“The raft of investments in the UK announced since the referendum – by Softbank, Glaxo, Nissan, Google and Apple amongst others, confirms it.”
Hammond says the announcement provides businesses with “certainty and stability”.
Cavendish Asset Management’s Paul Mumford says the announcement will help UK business’s hit by sterling weakness.
He says: “Pure UK domestic companies such as retailers, construction companies and property companies will have suffered from the currency deprecation but a drop in corporation tax will go a little way to alleviating the cost of imports, and will be helpful in mitigating the pressures of the increased living wage.”
Mumford says domestic companies will see the benefit to cash flow and higher earnings per share, while the UK will become a more attractive environment for overseas investors.