The global shipping industry will sit up and take notice of cuts to corporation tax, which are expected to be a huge boost for investment, the UK Chamber of Shipping commented following the tax cut announcement.
Namely, the UK Chancellor of the Exchequer and Second Lord of the Treasury, George Osborne, revealed yesterday in his budget that the UK government would cut tax for business from 20 to 18 percent.
Under the plan, it is envisaged for the tax rate to be reduced to the new level by 2020, with a 1 per cent interim cut in 2017.
“For big companies with profit over £20 million a year, we will bring forward corporation tax payments dates – so tax is paid closer to the point at which profits are earned.
This is fair, it’s more in line with what we’re doing in personal tax and is what almost all other G7 nations do. Banks make a key contribution to our economy, but also need to make a fair contribution,” Osborne said.
According to Osborne, the move is based on previous reductions in Corporation tax from 28 percent to 20 percent which had brought both investment and created jobs.
“Further reductions in corporation tax will help maintain the UK’s role as a global maritime leader,” the Chamber said, adding that the budget was sending a clear message from government that it would reduce tax for business so long as businesses support their workforce.
“The budget for 2015 is unashamedly pro-business but also hugely supportive of workforce. Our economy will be more dynamic as a result,” the Chamber added.
On the other hand, the Baltic Exchange said it would ask for a reversal of the UK government’s decision on cutting non-domicile tax status as it could result in driving away foreign national shipowners from the UK.
World Maritime News Staff