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Chancellor Rishi Sunak warned: Jobs will go in the event you hike taxes

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Leading Tory MP warns Chancellor Rishi Sunak’s corporation tax hike will ‘destroy jobs’ and make UK considered one of most taxed nations in Western world

Rishi Sunak’s corporation tax hike will ‘destroy jobs’ and make the UK one of the taxed nations within the Western world, a number one Tory MP has warned. 

Conservative MP John Redwood has called on the Chancellor to back down on the policy, adding that it could tip the country into recession. 

Top accountants and economists echoed his warning, stressing that the implications might be severe. 

Plea: Conservative MP John Redwood has called on Chancellor Rishi Sunak to back down on his corporation tax hike, adding that it could tip the country into recession

The levy can be introduced next April and sees corporation tax rise 6 per cent from 19 per cent to 25 per cent. 

Redwood told the Every day Mail: ‘Higher taxes will get him less revenue. They may get him slower growth or recession and damage British business and destroy jobs. 

‘It’s a nasty policy at a worse time. It is going to turn off investment when persons are fearful a couple of recession and there may be less money to draw.

‘I actually have called on the Chancellor to not raise national insurance – a tax on jobs – or raise corporation tax because you’ll have less revenue and investment, and never raise taxes overall because you’ll have slower growth.’ 

Redwood’s comments come as research shows the tax hike will make the UK considered one of the toughest places on this planet to do business. 

Accountants from UHY said the UK is about to drop 16 places in its corporate tax league table – from one of the competitive countries to lower than the worldwide average. 

The UK can be alongside France, and below the European and world average rates for the tax. It is going to also drop below Vietnam and Egypt. 

UHY Hacker Young tax head Andrew Snowdon said: ‘These tax hikes may lead investors to query the UK as a spot to establish shop.’ 

The report, released today, said increases including the national insurance hike will hurt the UK’s fame as a low tax environment. 

It comes as businesses feel the pinch from rising prices, while consumers look for methods to tighten their belts. 

Matthew Lesh, at think-tank the Institute of Economic Affairs, said: ‘The company tax hike will make the UK less appealing. They need to reverse the planned hike in corporation tax [and] replace the ‘super-deduction’.’ 

A Treasury spokesman said: ‘We needed to make tough but responsible decisions to repair the general public funds.’

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