London Daily

Focus on the big picture.
Saturday, May 31, 2025

Priti Patel calls on Jeremy Hunt to stop planned corporation tax rise

Priti Patel calls on Jeremy Hunt to stop planned corporation tax rise

The former home secretary has called on the Chancellor not to go ahead with the planned increase in corporation tax.
Former home secretary Priti Patel has urged the Chancellor to use his Budget next month to halt the planned corporation tax rise.

The senior Conservative has argued that “now is not the time” for an increase in the tax on big business.

In plans agreed while she served in Boris Johnson’s cabinet, corporation tax is due to rise from 19 to 25% in April.

Ms Patel has also called on Chancellor Jeremy Hunt to pull out of an international agreement preventing corporation tax from falling below 15%.

Britain was signed-up to the deal by Prime Minister Rishi Sunak when he was chancellor, in a move brokered by the Organisation for Economic Co-operation and Development (OECD) and heralded by the US.

Mr Sunak, announcing the deal in October 2021 when Ms Patel was home secretary, said it would lead to a “fairer tax system, where large global players pay their fair share wherever they do business”.

Speaking to the Daily Telegraph, Ms Patel said: “It is not too late for the Chancellor to back business and end the current political obsession of regulation, high taxes and interference with business.

“The Chancellor must send a positive signal to business in the Budget which supports jobs and economic growth. Now is not the time for an increase in corporation tax.

“Just like the issue of the OECD agreement, everything needs to be paused for the benefit of businesses around the country,” she added.

Mr Hunt is due to give his spring Budget on March 15 — a day being targeted by transport and civil service unions for strikes as part of long-running public sector rows over pay and working conditions.

The Chancellor is under pressure from the right of his party to slash taxes ahead of the next election in a bid to revive the UK’s stalling economy, which only narrowly avoided falling into recession last year.

Former prime ministers Mr Johnson and Liz Truss are among those advocating for cuts.

The calls come despite the tax burden on the country — the ratio of taxes as a share of gross domestic product (GDP), a measure of the size of the economy – reaching their highest levels since the 1950s during Mr Johnson’s time in Downing Street.

Ms Truss’s attempts to fire up the economy — a £45 billion spree of unfunded tax cuts, announced by her chancellor Kwasi Kwarteng — sent the value of the pound tumbling and pushed up mortgage rates in the autumn.

The tax burden under Mr Sunak remains high following the aftermath of the fallout from Ms Truss’s mini-budget.

Following Mr Hunt’s autumn statement in November, the Office for Budget Responsibility said plans for almost £25 billion in tax increases and more than £30 billion in spending cuts by 2027-28 would see the tax burden peak at 37.5% in 2024/25 — its highest level since the end of the Second World War.

Earlier this week, Mr Hunt appeared to rule out changing course on taxes after being handed a surprise monthly surplus in January thanks in part to lower public borrowing than forecast.

The Office for National Statistics revealed that the Government reported a surplus — when tax revenue received is larger than government spending — of £5.4 billion last month, driven by record returns from self-assessed income tax.

However, Mr Hunt told reporters that the numbers were “not anything like as significant as people are talking about”.

The UK Government has previously defended the planned corporation tax rise, saying it “will still be the lowest in the G7” even after April.

The tax cut lobbying comes after the Chancellor concluded his first international visit since taking over at the Treasury, having been in Bengaluru in India with Bank of England Governor Andrew Bailey.

The pair were in the south-east Asian country attending the G20 finance ministers and central bank governors meeting, which was held under India’s 2023 presidency.

Treasury officials said Mr Hunt used the visit to set out the UK’s growth agenda to international colleagues ahead of the Budget, with the senior Government figure meeting with US, French and Australian counterparts, along with Kristalina Georgieva, managing director the International Monetary Fund (IMF).

In a readout of the visit, the department said: “While speaking at the meetings, the Chancellor set out the UK Government’s intention to protect the most vulnerable from cost-of-living pressures, whilst maintaining fiscal sustainability with debt falling and not adding to inflationary pressure.

“He added that the upcoming spring Budget on March 15 will drive economic growth, focusing on skills, business and infrastructure investment and research and innovation, as well as reviewing regulations of the UK’s key growth industries.”

However, the G20 finance ministers gathering was overshadowed by a diplomatic row after it ended without consensus, with Russia and China objecting to the description of the war in Ukraine in a final document.
Newsletter

Related Articles

0:00
0:00
Close
Satirical Sketch Sparks Political Spouse Feud in South Korea
Indonesia Quarry Collapse Leaves Multiple Dead and Missing
South Korean Election Video Pulled Amid Misogyny Outcry
Asian Economies Shift Away from US Dollar Amid Trade Tensions
Netflix Investigates Allegations of On-Set Mistreatment in K-Drama Production
US Defence Chief Reaffirms Strong Ties with Singapore Amid Regional Tensions
Vietnam Faces Strategic Dilemma Over China's Mekong River Projects
Malaysia's First AI Preacher Sparks Debate on Islamic Principles
White House Press Secretary Criticizes Harvard Funding, Advocates for Vocational Training
France to Implement Nationwide Smoking Ban in Outdoor Spaces Frequented by Children
Meta and Anduril Collaborate on AI-Driven Military Augmented Reality Systems
Russia's Fossil Fuel Revenues Approach €900 Billion Since Ukraine Invasion
U.S. Justice Department Reduces American Bar Association's Role in Judicial Nominations
U.S. Department of Energy Unveils 'Doudna' Supercomputer to Advance AI Research
U.S. SEC Dismisses Lawsuit Against Binance Amid Regulatory Shift
Alcohol Industry Faces Increased Scrutiny Amid Health Concerns
Italy Faces Population Decline Amid Youth Emigration
U.S. Goods Imports Plunge Nearly 20% Amid Tariff Disruptions
OpenAI Faces Competition from Cheaper AI Rivals
Foreign Tax Provision in U.S. Budget Bill Alarms Investors
Trump Accuses China of Violating Trade Agreement
Gerry Adams Wins Libel Case Against BBC
Russia Accuses Serbia of Supplying Arms to Ukraine
EU Central Bank Pushes to Replace US Dollar with Euro as World’s Main Currency
Chinese Woman Dies After Being Forced to Visit Bank Despite Critical Illness
President Trump Grants Full Pardons to Reality TV Stars Todd and Julie Chrisley
Texas Enacts App Store Accountability Act Mandating Age Verification
U.S. Health Secretary Ends Select COVID-19 Vaccine Recommendations
Vatican Calls for Sustainable Tourism in 2025 Message
Trump Warns Putin Is 'Playing with Fire' Amid Escalating Ukraine Conflict
India and Pakistan Engage Trump-Linked Lobbyists to Influence U.S. Policy
U.S. Halts New Student Visa Interviews Amid Enhanced Security Measures
Trump Administration Cancels $100 Million in Federal Contracts with Harvard
SpaceX Starship Test Flight Ends in Failure, Mars Mission Timeline Uncertain
King Charles Affirms Canadian Sovereignty Amid U.S. Statehood Pressure
Trump Threatens 25% Tariff on iPhones Amid Dispute with Apple CEO
Putin's Helicopter Reportedly Targeted by Ukrainian Drones
Liverpool Car Ramming Incident Leaves Multiple Injured
Australia Faces Immigration Debate Following Labor Party Victory
Iranian Revolutionary Guard Founder Warns Against Trusting Regime in Nuclear Talks
Macron Dismisses Viral Video of Wife's Gesture as Playful Banter
Cleveland Clinic Study Questions Effectiveness of Recent Flu Vaccine
Netanyahu Accuses Starmer of Siding with Hamas
Junior Doctors Threaten Strike Over 4% Pay Offer
Labour MPs Urge Chancellor to Tax Wealthy Over Cutting Welfare
Publication of UK Child Poverty Strategy Delayed Until Autumn
France Detains UK Fishing Vessel Amid Post-Brexit Tensions
Calls Grow to Resume Syrian Asylum Claims in UK
Nigel Farage Pledges to Reinstate Winter Fuel Payments
Boris and Carrie Johnson Welcome Daughter Poppy
×