Corporation tax will drop by five per cent, says Chancellor George Osborne

Chancellor George Osborne has outlined a series of policies to boost businesses in the UK during his Budget 2011 speech today.

Chancellor George Osborne announces Budget 2011
Chancellor George Osborne announces Budget 2011

Plans to "make Britain the best place in Europe to start, grow and finance a business" have been unveiled by Chancellor George Osborne in his Budget today (23 March).

"Britain is open for business," said Osborne during his speech in the House of Commons today. "Today’s Budget is an urgent call to action for Britain. Private sector growth must take the place of public sector deficits."

The Chancellor said plans include simplifying the tax system by scrapping 43 "complex tax reliefs", merging the National Insurance and income tax systems, and reducing corporation tax.

Corporation tax is set to be reduced by two per cent in April, rather than the one per cent previously planned, and will also fall by a further one per cent in each of the following three years.

This will take the rate of corporation tax down to 23% and is set to be funded by an "adjuustment in the bank levy rate next year", added the Chancellor.

Meanwhile, Osborne confirmed that Air Passenger Duty increases are set to be delayed

Peugeot's dealer events and incentives manager Louise Dowling had told C&IT that any rise would have a negative impact on business travel.

However, UKInbound chief executive Julie Rance said: "The APD freeze will simply not be sufficient in itself to move the UK up the rankings to become one of the top five destinations in the world. The UK still taxes travel at a much higher level than any other European country. The Chancellor is sticking plaster on the wound."

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