To ask the Chancellor of the Exchequer what assessment he has made of the effect on tax revenue in the financial year 2006-07 of the decisions (a) to remove the 0 per cent. starting rate of corporation tax, (b) not to up-rate the corporation tax thresholds in line with inflation and (c) the removal of the tax exemption for employer-provided laptop computers.
holding answer
The information is as follows:
(a) The decision to remove both the 0 per cent. starting rate and the 19 per cent. non-corporate distribution rate of corporation tax was announced in the 2005 Pre-Budget Report. The effect on tax revenue in the financial year 2006-07 of this decision may be found at: http://www.hm-treasury.gov.uk/media/20F/2F/bud06_cha_134.pdf in Table A2 under Building a Fairer Society: tackling tax motivated incorporation.
(b) There is no requirement to increase the corporation tax profit limits in line with inflation. The upper profit limit (currently £1,500,000) is tied through regulations to the limit below which companiesno longer pay corporation tax through quarterly instalments, so increasing it would have an impact on the timing of tax receipts from some companies. Given this, it is not possible to estimate accurately the impact of increasing the profit limits on tax receipts in advance of setting the transitional rules that would be required for these companies.
(c) The decision to remove the tax exemption for employer provided computer equipment was announced at Budget 2006. The effect of this decision on Exchequer revenue in the financial year 2006-07 may be found at: http://www.hm-treasury.gov.uk/media/20F/2F/bud06_cha_134.pdf in Table A1 under Building a Fairer Society: Duties and other tax changes.
Yes1 person thinks so
No0 people think not
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