Why has the UK corporation tax raised so much revenue?
UNSPECIFIED. (2004) Why has the UK corporation tax raised so much revenue? FISCAL STUDIES, 25 (4). pp. 367-388. ISSN 0143-5671Full text not available from this repository.
We analyse a puzzle in the UK corporation tax: by both historic and international standards, corporation tax revenues have been high while the statutory rate has been reduced. We consider explanations based on changes in the tax law and in economic factors. Changes in the tax law, such as base-broadening measures through reductions in capital allowances, can explain only part of the puzzle. Among the economic explanations, an increase in the size of the corporate sector, mainly caused by expansion of the service sector and improvements in profitability of the financial sector, seems the most likely. To the extent that higher profits, particularly financial sector profits, may have led to high revenues, there are doubts as to whether revenues will continue to be so strong.
|Item Type:||Journal Article|
|Subjects:||H Social Sciences > HG Finance
H Social Sciences > HC Economic History and Conditions
|Journal or Publication Title:||FISCAL STUDIES|
|Publisher:||INST FISCAL STUDIES|
|Official Date:||December 2004|
|Number of Pages:||22|
|Page Range:||pp. 367-388|
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