Business tax receipts up 22% in the first six months
Business tax receipts up 22% in the first six months
Overall receipts from business taxes in the six month period from April to September 2023 jumped by 22% year-on-year to £43.3bn, £7.7bn higher than the same period last year, according to new figures published by HMRC today.
The huge rise in business tax receipts is largely due to the increase in the headline rate of corporation tax which came into force from April 2023, but HMRC also pointed to growth in company profits as a reason behind the rise.
Corporation tax receipts alone for the first six months rose to £39.5bn, up 17% from £33.7bn in the same period last year.
Overall tax receipts in the first six months were up 6.2% year-on-year.
The latest public sector finances data, also published today, revealed that public sector net debt was £2,599.0 billion at the end of September 2023, provisionally estimated at around 97.8% of the UK’s annual gross domestic product (GDP). This is 2.1 percentage points higher than in September 2022.
Commenting on the latest figures Paul Falvey, a tax partner at BDO said:
“Today’s figures illustrate the extent to which businesses have been impacted by the recent rise in corporation tax.
“The chancellor has made it clear that he would like to see the tax burden on businesses reduce but given the state of the public finances and the likelihood of interest rates remaining high for some time, there is little prospect of this at the Autumn Statement.
“Businesses are likely to reluctantly accept that tax rates may need to stay high for some time, but they will hope that the government invests in improving HMRC’s service levels. The current poor response times and delays in modernising the tax administration system are proving a drag on business efficiency and ultimately will impair UK competitiveness.”
ENDS
About BDO
Accountancy and business advisory firm BDO LLP provides integrated advice and solutions to help businesses navigate a changing world.
The organisations we work with are Britain’s economic engine –entrepreneurially-spirited, high-growth businesses that fuel the economy.
We understand the ambitions and entrepreneurial mindset of those we work with and have the global reach, integrity and expertise to help people and businesses succeed.
BDO LLP
BDO LLP operates in 17 offices across the UK, employing 7,500 people offering tax, audit and assurance, and a range of advisory services. BDO LLP is the UK member firm of the BDO international network.
BDO’s global network
The BDO global network provides business advisory services in 164 countries and territories, with 111,300 people working out of 1,803 offices worldwide. It has revenues of US$12.8bn.
Contacts
Frank Shepherd
frank.x.shepherd@bdo.co.uk
07812 463601
bdo.uk.com/news
twitter.com/BDOaccountant
The huge rise in business tax receipts is largely due to the increase in the headline rate of corporation tax which came into force from April 2023, but HMRC also pointed to growth in company profits as a reason behind the rise.
Corporation tax receipts alone for the first six months rose to £39.5bn, up 17% from £33.7bn in the same period last year.
Overall tax receipts in the first six months were up 6.2% year-on-year.
The latest public sector finances data, also published today, revealed that public sector net debt was £2,599.0 billion at the end of September 2023, provisionally estimated at around 97.8% of the UK’s annual gross domestic product (GDP). This is 2.1 percentage points higher than in September 2022.
Commenting on the latest figures Paul Falvey, a tax partner at BDO said:
“Today’s figures illustrate the extent to which businesses have been impacted by the recent rise in corporation tax.
“The chancellor has made it clear that he would like to see the tax burden on businesses reduce but given the state of the public finances and the likelihood of interest rates remaining high for some time, there is little prospect of this at the Autumn Statement.
“Businesses are likely to reluctantly accept that tax rates may need to stay high for some time, but they will hope that the government invests in improving HMRC’s service levels. The current poor response times and delays in modernising the tax administration system are proving a drag on business efficiency and ultimately will impair UK competitiveness.”
ENDS
About BDO
Accountancy and business advisory firm BDO LLP provides integrated advice and solutions to help businesses navigate a changing world.
The organisations we work with are Britain’s economic engine –entrepreneurially-spirited, high-growth businesses that fuel the economy.
We understand the ambitions and entrepreneurial mindset of those we work with and have the global reach, integrity and expertise to help people and businesses succeed.
BDO LLP
BDO LLP operates in 17 offices across the UK, employing 7,500 people offering tax, audit and assurance, and a range of advisory services. BDO LLP is the UK member firm of the BDO international network.
BDO’s global network
The BDO global network provides business advisory services in 164 countries and territories, with 111,300 people working out of 1,803 offices worldwide. It has revenues of US$12.8bn.
Contacts
Frank Shepherd
frank.x.shepherd@bdo.co.uk
07812 463601
bdo.uk.com/news
twitter.com/BDOaccountant