London, March 15 (EFECOM).- UK Economy Secretary, Jeremy Hunt, confirmed Wednesday an increase from 19 to 25% corporate tax in the UK, but introduced incentives for immediate reductions over three years for companies investing in designated areas.
Hunt laid bare his fiscal policy when he presented his State Budget proposal to the House of Commons, where he also considered providing aid to lower energy costs, among other things.
From next April, when the new tax year begins, British companies with profits of more than 250,000 pounds (286,000 euros) per year will be subject to the new tax rate.
However, Hunt assures that only 10% of them will pay the full 25% rate, thanks to a new tax deduction system that can be made immediately, rather than over a longer accounting period.
“This means that every pound a business invests in machinery, plant or IT equipment is immediately deducted in full from taxable profit. This is a corporate tax cut of an average value of 9,000 million pounds (10,300 million euros) per year for each year that will apply,” he said.
Hunt said he would study the possibility of keeping this direct cut plan permanently, which the sector had demanded.
For small companies, the same system will apply to investments of up to 1 million pounds per year (1.14 million euros), he said.
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