The UK’s Chancellor of the Exchequer has suggested in an interview that he intends to reduce the corporation tax rate to less than 15% in an effort to attract business. This would be part of an effort to build a “super-competitive economy” featuring low business taxes and a global focus. No timetable was however mentioned for the corporation tax rate reduction.
A five-point plan outlined by the Chancellor also included a new effort to attract investment from China; support for bank lending; further efforts to invest in the north of England; and maintenance of fiscal credibility. Any further plans for revenue-raising measures or spending cuts are to be made only after official forecasts have been studied and are likely to be announced in the Autumn Statement later in the year.
The Chancellor is encouraging the Bank of England (BoE) to exercise its powers to avoid contraction of credit. Among the options open to the BoE are a new Funding for Lending Scheme to support lending.
The UK will be active in looking for bilateral trade deals. The Chancellor considers that the UK should look for the maximum access to the EU’s single market for its goods and services including financial services.
