Chi Onwurah – 2015 Parliamentary Question to the HM Treasury
The below Parliamentary question was asked by Chi Onwurah on 2015-12-15.
To ask Mr Chancellor of the Exchequer, pursuant to the Answer of 8 December 2015 to Question 19258, if he will estimate the reduction in pounds in the amount of tax collected from the manufacturing sector as a consequence of reductions in the corporate tax rate.
Mr David Gauke
Over the course of the previous Parliament, the main rate of corporation tax was cut from 28% to 20%. The small profits rate was also cut to 20% and the two rates were merged to simplify the tax regime. Overall the cuts delivered since 2010 will save businesses £10bn a year from 2016-17. In this Parliament the Government is going to go further, and cut the rate to 19% in 2017 and 18% in 2020, further benefitting over one million companies across the economy.
Given that a number of factors impact on tax receipts from individual sectors it is difficult to estimate precisely how much tax the manufacturing sector has saved as a result of these cuts in corporation tax. But according to HM Revenue and Customs’ corporation tax statistics, published at the link below, over the past five years the UK manufacturing sector has paid an average of £5bn a year in corporation tax. So it is clear that the sector will have benefitted substantially from the tax cuts delivered since 2010, and will benefit further from the reductions to come in this parliament.
“
