TaxCorporate TaxCorporation tax minefield is creating ‘two-tier’ system

Corporation tax minefield is creating 'two-tier' system

Some 8,300 pages of rules and regulations are creating a two-tier tax system as companies struggle with compliance

A World Bank and
PricewaterhouseCoopers
joint report has issued a warning about the intricacies of the UK’s corporation
tax system.

The study warned that the complexity of the rules was causing a two-tier
system, because only the largest companies were able to afford the advice to
negotiate the minefield of rules and regulations.

According to the study, Britain has the 42nd lowest business tax burden, with
taxes equal to 35.4% of annual profits, but compliance has become a significant
hurdle.

Despite being ranked 12th out of 175 countries in which it was easiest to pay
the business tax itself, UK companies must trawl through 8,300 pages of primary
tax law before they meet requirements.

In terms of length, the UK corporate rulebook dwarfed its equivalents in the
US (5,000 pages), Germany (1,700 pages) and France (1,300 pages).

Peter Cussons, a tax partner at PwC told
the Times: ‘I do not
think it can carry on, because non-compliance will increase through sheer
ignorance.’

Related links:

Small businesses get help on R&D tax
credits
 

Corporation tax should be cut

The business of the future: accident waiting to happen

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