British Prime Minister Theresa May will declare her intention to match the expected corporation tax cuts that President-elect Donald Trump promised he would introduce. In what is seen as an olive branch to Britain’s business community, Ms. May is trying to make up for past comments.
The Prime Minister’s goal to make sure that prosperity is shared more equally has been interpreted by many as an anti-business gesture. Her aim in her first speech to the CBI (Confederation of British Industry) at Grosvenor House, London, will be to rebuild links within the UK’s business environment.
She will explain that her aim is for Britain to continue being a low-tax nation, leading the way among the G20 group of countries.
If Donald Trump reduces US corporate tax to 15%, Theresa May says she’ll do the same in the UK. (Source: home.kpmg.com)
Corporation tax rates to fall further
Corporation tax (US: corporate tax) in the UK stands at 20%. By 2020, it is destined to fall to 17%.
The United States currently has the highest corporation tax rates among the advanced economies. Mr. Trump said he would cut ‘corporate tax’ from 40% (according to KPMG) to 15% if he won the US presidential elections – which he did.
In order to be the corporation tax haven of the G20 countries, the UK would have to at least match Mr. Trump’s pledge.
Brexit – Britain Exiting the European Union – will not only give the UK the opportunity to free itself, but also to change the nation and make it forever fairer, Ms. May will say.
Prime Minister Theresa May knows that for Britain to survive and thrive outside the European Union, it will need to be a world leader for businesses. (Image: twitter.com/theresa_may)
R&D funding boost
She will also pledge to boost science and research funding by £2 billion annually by 2020.
The Prime Minister will say:
“In the Autumn Statement on Wednesday, we will commit to substantial real terms increases in Government investment in R&D [research & development] – investing an extra £2 billion a year by the end of this Parliament to help put post-Brexit Britain at the cutting edge of science and tech.”
“And we will also review the support we give innovative firms through the tax system, because my aim is not simply for the UK to have the lowest corporation tax rates in the G20, but also one that is profoundly pro-innovation.”
She will also urge companies to do more to spread the wealth, and to play by the same rules as everybody else when it comes to behaviour and paying taxes. Investing in the long term is crucial for the country’s economic health, she will add.
The best way to lift people out of poverty is with a healthy, robust economy in a free-market system, Ms. May will say.
Ms. May will also say:
“We believe in capitalism – the means by which we drive economic growth, putting people into work to provide for their families. And we believe in business – the entrepreneurs and the innovators who employ millions of people up and down this country – the basis for our prosperity.”
“The Conservative Party – and the Government I lead – will always believe in these things. But I am here today not just to reaffirm these core beliefs, but to say that – if this is what we value – we need to be prepared to adapt and change.”
“For if we support free markets, value capitalism and back business – and we do – we must do everything we can to keep faith with them.”
Paul Drechsler, President of the CBI, will say in a speech that UK businesses are one-hundred percent committed to a successful Brexit.
The CBI, which represents more than 190,000 businesses, says it wants to help the Government ensure a smooth transition when it leaves the European Union.
Video – CBI Conference 2016
The CBI Conference 2016 is said to be the organisation’s largest ever, with more than 1,000 political and business delegates.