The impact of the COVID-19 pandemic on the 100 Group tax contribution
increase in R&D expenditure
total tax rate
of total government receipts
total tax contribution
The 2021 Total Tax Contribution report presents the tax and economic contribution of the largest listed companies in the UK for 2020/21, showing the impact from the COVID-19 pandemic.
Now in its 17th year, the annual survey collects data from 100 Group members on their UK tax contribution and reports on the contribution made in taxes borne, taxes collected, and the wider economic contribution.
We have analysed trends over the last 12 months and also the last 17 years, highlighting the changing tax profile and how changing economic conditions and legislation have impacted these trends.
Explore the data from our TTC surveys 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.
Analysis over the 17 years of the survey shows a significant change in the profile of taxes borne. The contribution made to total taxes borne by taxes other than corporation tax is greater in 2021 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.
Over 17 years, the TTC survey has collected an extensive bank of data on tax payments by the 100 Group members. 27 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.
Over the survey period, corporation tax has been on a downward trend, while the amounts of other business taxes borne have increased. The fall in corporation tax is due to a number of factors: reductions in the statutory rate of corporation tax (from 30% in 2005 to 19% from April 2017), but also, between 2010 to 2015, reduced contributions from the oil and gas sector due to lower oil prices and production levels, from the retailers due to challenging economic conditions, and from the financial services sector, mainly due to brought forward losses.
In 2017 there was an increase in corporation tax for the first time since 2011, following a greater contribution from the financial services sector, largely due to legislative changes affecting the banks and strong performance of investment assets affecting the insurers. Following three consecutive annual increases, corporation tax paid by these 27 companies decreased in 2019 as a result of lower profits and decreased once again in 2021 as a result of the COVID-19 pandemic. Government legislation has had a clear impact on the corporation tax paid by the banks in the survey, with tighter loss relief legislation, non-deductibility of compensation payments, and the introduction of the bank surcharge in January 2017, imposing an additional 8% surcharge on bank profits.
Tighter loss relief legislation applied to other industry sectors from April 2017, with 50% of taxable profits eligible to be offset by carried forward losses. Legislation restricting corporate interest deductions was also introduced from April 2017. In 2021, corporation tax is once again the largest borne by 100 Group companies.