Business taxation under the coalition government

Maffini, Giorgia (2015) Business taxation under the coalition government. The Tax Journal, 25th April 2015.


The coalition’s extensive reforms succeeded in making the UK attractive for foreign direct investment and mobile profits. However, when judged according to a key indicator, the effective marginal tax rate, which affects the size of investment, the UK is not particularly competitive. Other reforms have increased competitiveness, including an increase in R&D tax incentives, the introduction of the patent box, and a relaxation in the CFC rules. The cost of the reforms in terms of foregone revenues is large, around £7.5bn in 2015/16, equivalent to 21% of corporation tax revenue. Empirical evidence shows, though, that large corporate tax cuts foster investment and capital stock substantially.

Item Type: Article
Keywords: corporate taxation, finance
Subject(s): Finance
Centre: Oxford University Centre for Business Taxation
Date Deposited: 10 Nov 2015 12:49
Last Modified: 27 Feb 2017 14:25
Funders: not applicable

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