Box sets » Receipts » Corporation tax

Line chart showing business investment by asset type
Over the last 3 years, the UK corporation tax system has witnessed four major changes which have consequences on the outlook for business investment. In this box, we explored the effect of the corporation tax rate rise and the super-deduction on investment, before assessing the impact of moving from temporary to permanent full expensing as announced in this Autumn Statement.

Economy categories: GDP by expenditure

Fiscal categories: Corporation tax

Stacked line chart showing national accounts taxes (excluding PSNB neutral): Changes since March
We have made a significant upward revision to our pre-measures receipts forecast. This box explored the drivers behind the revision, which taxes drive the revision and how much of this change is due to real GDP, inflation and the effective tax rate.
Chart 3.A: Real GDP and tax revenues: October forecast versus outturn
Since our October 2021 EFO the real economy has performed largely as expected in 21-22 but tax receipts have come in well above that forecast. In this box, we examined reasons why tax receipts have recovered so quickly particularly in comparison to economic data.

Economy categories: Nominal GDP

Fiscal categories: Receipts, VAT, Income tax, Corporation tax

Cross-cutting categories: Coronavirus

Chart 3.D: Electric vehicle new car market share
This box outlined the recent growth in electric vehicle sales and the fiscal implications of this and the role of policy in the transition.

Fiscal categories: Receipts, Vehicle excise duties, Fuel duty, Corporation tax

Cross-cutting categories: Climate change

Chart B: Onshore corporation tax receipts versus the headline rate
The rise in the main rate of corporation tax (CT) announced at Budget 2021, from 19% to 25% – from 2023-24, marks the first rise in the main rate of onshore CT since 1974. This box put this policy change in its historical and international context, by looking at onshore CT receipts as a share of GDP within the UK since its inception in 1965, and by looking at other corporate tax rates across OECD countries.

Fiscal categories: Receipts, Corporation tax

Why have onshore CT receipts performed so well since 2013-14?
In recent years, onshore corporation tax receipts have repeatedly surprised on the upside. This box described the drivers behind that strength, in particular the contribution from a rising effective tax rate despite cuts to the headline rates.

Fiscal categories: Corporation tax, Bank surcharge

Revisions to borrowing in 2016-17
Initial estimates of the deficit can be revised significantly over subsequent months as more reliable data become available. This box set out how our forecasts during 2016 and 2017 evolved and how the outturns for 2016-17 were revised over time.
The receipts-to-GDP ratio since 1986-87
Strong overall receipts growth in 2016-17 took receipts as a share of GDP to their highest since 1986-87. This box explored how the composition of the public sector’s income has changed over the three decades since receipts were last at the latest share of GDP.
The effect of incorporations on tax receipts
Our PAYE, SA, NICs and corporation tax (CT) forecasts are affected by our assumption that incorporations will continue their rising trend. This box covered historical estimates, the modelling of the receipts effects from incorporations and the implications for the forecast.
The ONS announced that it would implement a new accruals methodology for corporation tax (CT) early in 2017. This box outlined in detail the changes to the ONS methodology.

Fiscal categories: Receipts, Corporation tax

Fuel duty rates and policy risks to our forecast
Our fuel duty receipts forecast combines our underlying forecast assumptions about the amount of fuel that will be purchased and the Government’s stated policies on the fuel duty rates that will be levied on those purchases. This box outlined the changes in fuel duty and policy assumptions since 2010.

Fiscal categories: Corporation tax, Fuel duty, Receipts

‘Computable general equilibrium’ (CGE) modelling is a tool for assessing the potential medium and long-term economic impact of policy changes. This box explored recent Government CGE studies of cuts to corporation tax and fuel duties alongside the potential impact of other recent tax rises and spending cuts.
In each Economic and fiscal outlook we publish a box that summarises the effects of the Government’s new policy measures on our economy forecast. These include the overall effect of the package of measures and any specific effects of individual measures that we deem to be sufficiently material to have wider indirect effects on the economy. In our March 2013 Economic and Fiscal Outlook, we made adjustments to our forecasts of real GDP, business investment and inflation
In each Economic and fiscal outlook we publish a box that summarises the effects of the Government’s new policy measures on our economy forecast. These include the overall effect of the package of measures and any specific effects of individual measures that we deem to be sufficiently material to have wider indirect effects on the economy. In our December 2012 Economic and Fiscal Outlook, we made adjustments to our forecasts of real GDP, inflation and property transactions
In each Economic and fiscal outlook we publish a box that summarises the effects of the Government’s new policy measures on our economy forecast. These include the overall effect of the package of measures and any specific effects of individual measures that we deem to be sufficiently material to have wider indirect effects on the economy. In our March 2012 Economic and Fiscal Outlook, we made adjustments to our forecasts of real GDP, business investment and inflation.
Impact of interest rates on the public finances
This box set out the impact of changes in interest rates on our public finances forecast, including debt interest spending and income tax receipts. Updated versions of our ready reckoners can be found on our website.
Tax revenues from the financial sector
The sectoral landscape of the economy had changed markedly with the financial sector becoming increasing important. This box examined implications for tax revenue arising from the financial sector.

Fiscal categories: Receipts, Income tax, Corporation tax

Cross-cutting categories: Financial sector

In each Economic and fiscal outlook we publish a box that summarises the effects of the Government’s new policy measures on our economy forecast. These include the overall effect of the package of measures and any specific effects of individual measures that we deem to be sufficiently material to have wider indirect effects on the economy. In our March 2011 Economic and Fiscal Outlook, we made adjustments to our forecast of inflation.

Economy categories: Inflation

Fiscal categories: Receipts, Fuel duty, Income tax, Corporation tax