Corporate welfare costs £93bn

‘The Guardian claims taxpayers are handing businesses £93bn a year in corporate welfare payments. The figure has been calculated from the first comprehensive account of what Britons give away to companies in grants, subsidies and tax breaks.

The findings have raised questions of Britain’s corporate tax regime – In the financial year 2012-2013, the government spent £58.2bn on subsidies, grants and corporate tax benefits, but took just £41.3bn in corporation tax receipts.

Source: The Guardian

Nearly half of this figure of £93 billion is accounted for by “corporate tax reliefs” – that is, allowing businesses to keep a bit more of their own money. On that logic, any reduction in the rate of business tax amounts to “government funding” for business. If I earn £100 and I pay £20 in tax, does that mean that the government have funded me to the extent of £80? I think not, except in the alternative universe inhabited by the Guardian.

David Whiscombe


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