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I'm no expert on the relationship between tax revenues and the costs of the state although I sense those numbers may not add up. Retaining the likes of Jeff Sprecher and his businesses in the UK in an otherwise more awkward trading environment (by virtue of not being in the single market) is likely to be achieved through incentives that involve paying less tax overall. Hence the discussion about Corporation Tax, and reducing it from 20% to something closer to 15%.
boristrump-
Totally agree. I'm not an expert in the slightest, but I think it's a bit simplistic to think that cutting tax immediately frees up capital which will automatically be re-invested and pay dividends.
But I do think reducing CT makes sense. The gradual drop has made it less economically viable for SMEs to avoid tax, because the cost of avoiding is so close to the cost of the tax. What frustrates everyone is the tiny amount of tax large companies pay, but I don't understand how you tackle that without disadvantaging the UK economy.
hugo7
Reduced tax = economic stimulus and growth = more tax revenue
Combine that with less wastage from state overspend = more money for the important things.