UK Sees Corporate Tax Windfall After Brexit Decision
The 15.5 percent year-on-year increase in UK corporate tax receipts, reported recently by HM Revenue and Customs (HMRC), demonstrates that company profits have not yet been dented by the UK’s decision to leave the European Union, says London tax advisory firm Blick Rothenberg.
Tax receipts were up 6.86 percent in the 12 months to June 2017, compared with a year earlier, driven in large part by a GBP6.9bn (USD9.12bn) surge in corporate tax receipts.
Much of this growth came in the last nine months to June 2017, with a 20 percent increase following the Brexit vote in June 2016 and the subsequent fall in the value of sterling, which allowed UK companies exporting goods and services abroad to sell more at higher margins, generating greater profits and therefore paying more tax.
“Brexit seems to be working well as far as HMRC’s receipts of corporation tax are concerned. In the 12 months to June receipts of corporation tax increased by 15.5 percent to GBP51.5bn,” said Paul Smith, partner at Blick Rothenberg. “The next 12 months may be a little more difficult as costs of imported raw materials have also risen, but it is good to see that British business has done well so far.”
Individual income tax receipts were up 4.77 percent and stamp duty land tax revenues were up 10 percent year-on-year.
Source: Tax News – UK Sees Corporate Tax Windfall After Brexit Decision
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