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Total Tax Contribution of the 100 Group

Welcome to the twelfth PwC Total Tax Contribution (TTC) annual survey of the 100 Group. This report presents the analysis of data received from 100 companies, displaying the TTC and wider economic contribution for 2016, along with the trend analysis over the twelve years of the survey.

Survey results

Andrew Packman, leader of the Total Tax Contribution Group in the UK, introduces the key findings from this year’s survey, which emphasises the continuing importance of the 100 Group to the UK economy, and how the impact of tax policy varies by industry sector.

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The Total Tax Contribution of the 100 Group increase by £1.8bn in 2016
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TTC of the 100 Group increased in 2016

The Total Tax Contribution of the 100 Group was £82.3 billion, up from £80.5 billion in 2015. This includes both taxes borne of £23.7bn and taxes collected of £58.6bn, and represents 13.3% of total government receipts.

Companies contribute more than corporation tax to the public finances 

Corporation tax is the third largest tax borne, after employers’ NIC and business rates. The contribution from corporation tax has increased by 9.2% from the previous year, despite the statutory rate being at its lowest level since the survey began 12 years ago.

For every £1 of coporation tax, there was another £4 in other business taxes borne.
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The proportionof taxes borne by industry sector continues the trend away from oil and gas companies towards financial services
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Evidence of a sectoral shift in the taxation of the 100 Group

The impact of tax policy varies by industry sector. Business rates are the largest tax for retailers, and a significant tax for telecoms and utilities. Bank levy is the largest tax for banks, and irrecoverable VAT continues to be a substantial tax for insurers.
 
The proportion of taxes borne by industry sector continues the recent trend away from oil and gas companies and towards the financial services sector.

An increase in taxes borne from 2015 to 2016

There was an increase in taxes borne of 3.6% compared to 2015, driven mainly by increases in corporation tax and bank levy.

Banks and insurers are driving the increase in corporation tax. The banks have been affected by legislative changes and the tax payments of insurance companies reflect buoyant gilt and bond markets.

The contribution from the banking sector increased further due to rising bank levy rates contributing to an increase of 24.4% in bank levy from the previous year.

The 3.6% increase in taxes borne was driven mainly by increases in corporation tax and bank levy.
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Over the last 5 years, the 100 Group have made a substantial contribution to innovation and the fabric of the UK economy.
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The contribution goes beyond tax

We estimate the 100 Group employed 2.1 million people, representing 6.6% of the total UK workforce, paid an average wage of £33,220 (the national average is £28,200) and contributed employment taxes of £12,135 per employee on average.

Over the last five years, survey participants have spent £130.6 billion on capital investment and £32.9 billion on research and development.

Half of the value distributed – a measure of the relative value received by each stakeholder – by 100 Group participants goes to the government in taxes (50.5%).

Explore the Total Tax Contribution of the 100 Group over the last twelve years

Our tool below allows you to explore the data from our Total Tax Contribution survey in more detail, comparing the change in profile between different years and different taxes.

The survey collects data from 100 Group members on the contribution made in all taxes borne - the taxes that represent a cost to the company such as corporation tax, employers’ NIC, business rates, irrecoverable VAT, and bank levy.

The changing profile of taxes borne between 2005 and 2016

Over the twelve years of the survey, a major finding is the change in profile of taxes borne. The contribution made to total taxes borne by taxes other than corporation tax is greater in 2016 when compared with 2005. This changing profile for the 100 Group suggests that tax revenues contributed by this group of companies have become materially less dependent on corporation tax. There has been a consistent trend away from a tax based on profits to taxes based on people, production and property.

Trends in taxes between 2005 and 2016

Over twelve years, the TTC survey has collected an extensive bank of data on tax payments by the 100 Group members. Thirty three companies have provided data in all the surveys we have undertaken. This enables us to look at the trends in their results on a like for like basis, taking 2005 as 100% for each tax.

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Trends in taxes between 2005 and 2016

Over eleven years, the TTC survey has collected an extensive bank of data on tax payments by the 100 Group members. Thirty four companies have provided data in all the surveys we have undertaken. This enables us to look at the trends in their results on a like for like basis, taking 2005 as 100% for each tax.

year,Corporation tax,Employers' NIC,Business rates,Irrecoverable VAT,Petroleum revenue tax,Bank Levy,Other
2005,50,20,11,9,4.1,0,6
2006,52.1,16.9,12.6,8.3,5.8,0,4.3
2007,55.9,15.2,11.5,7.8,5.7,0,3.9
2008,46.8,20.2,14.1,9.7,4,0,5.3
2009,44,21.4,14.5,9.4,6.5,0,4.3
2010,33.7,27.4,20.3,10.6,2.8,0,5.2
2011,39.5,23.3,15,10.7,2.5,0,8.9
2012,32.8,25.2,16.9,13.8,3.1,3.2,5.1
2013,25.9,27.5,18.9,14.1,3.1,5.2,5.4
2014,23.4,28.2,19.5,15,1.3,5.9,6.6
2015,18.3,29.4,21,15.6,0.4,8.1,7.2
2016,19.7,27.7,20.9,15.1,0.0,9.6,7.0
year,Corporation tax,Other taxes borne,Taxes borne,Irrecoverable VAT,Business Rates,Employers' NIC
2005,100,100,100,100,100,100
2006,114.9,115.3,115.1,95.8,127.1,102.6
2007,139.8,120.1,131.0,96,144.7,107
2008,103.9,129.9,118.2,107.4,145.6,115.9
2009,109.4,130.4,119.8,113.8,131.7,104.2
2010,43.5,125.3,89,111.6,143,104
2011,85.5,148.4,126.3,149.1,148.4,118.2
2012,82.7,159.8,119.2,189.6,161.6,150.3
2013,57.2,172.4,111.3,198,172.3,149
2014,46.9,173.4,105,219.6,178.6,147.7
2015,40.4,177.8,102.9,220.9,186.3,149.6
2016,41.1,179.9,103.9,220.3,193.5,149.9

Notes about the survey

  1. Total taxes borne in 2016 are higher than in 2005.
  2. Charts are based on data from survey participants in each survey.
  3. PwC has anonymised and aggregated this data to produce the survey results.
  4. All twelve TTC surveys with the 100 Group use the same PwC TTC methodology which enables the results to be compared.
  5. PwC has not verified, validated or audited the data and cannot give any undertakings as to the accuracy of the survey results in that respect.

 

Contact us

Andrew Packman
Total Tax Contribution and Tax Transparency leader
Tel: +44 (0)189 552 2104
Email

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