Government should stand firm on business tax, says TUC

by Philip Morton, Investors Offshore.com

27 November 2007

Brendan Barber, the General Secretary of the Trades Union Congress (TUC) has - not entirely unexpectedly - spoken out this week to ask the government not to give in to pressure from the Confederation for British Industry (CBI) and others over business taxes.

In a statement published on Monday, Mr Barber urged the government to resist calls by the CBI and other business groups in the UK to reduce corporate taxes, arguing that:

"The Government should stand firm against the relentless business campaign for cuts in business tax, and should instead get tough with the super-rich who fail to pay their fair share."

Going on to suggest that reducing business taxes may eventually lead to a rise in taxes for ordinary individuals, Barber argued that this would be unfair, given that those who qualify for business tax can afford to meet the costs required of them, a statement likely to be hotly disputed by the those on the receiving end of the UK's corporate tax regime.

"The truth is that UK business is not overtaxed. UK corporate rates are pretty average," Barber suggested, adding: "And many UK businesses are expert at reducing their tax bill - the National Audit Office say that one in three of our 700 biggest businesses paid no corporation tax last year."

According to Mr. Barber: "'If there are to be any changes in business tax to help smaller businesses then the Chancellor should make sure that they are paid for by effectively taxing private equity and the big companies who do not pay their fair share."

He concluded:

"Indeed it is time Britain's smaller businesses and genuine entrepreneurs recognised that they, just as much as public service users and individual tax payers, are footing the bill for the tax breaks for private equity and the super-rich."

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