Jon Richardson, Tax Leader for Policy, Reputation, Regulation and Risk at PwC UK, comments
The UK R&D tax credit regime and tax allowances for capital investment are not generous by international standards so there is a need to do something, otherwise the UK will not be competitive from April 2023 when the super deduction ends and the corporation tax rate increases to 25%.
The Chancellor’s Tax Plan focuses on innovation, capital and skills, which are the right things to focus on when it comes to fostering growth and productivity, and will be largely welcomed by business. The gains in productivity and growth planned by the chancellor will not happen overnight but the Chancellor has focused on the right priorities.
The Tax Plan also expresses a desire to reform and simplify the tax system. It looks like the focus will be on reducing the myriad of tax reliefs and allowances - we will have to wait and see who will be the winners and losers from this simplification.
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