The only element missing from the Treasury’s swoony video about chancellor Rishi Sunak was Westlife’s “You Raise Me Up” as the soundtrack. The Budget will elevate corporation tax more than the chancellor’s public image. The headline rate will leap an eye-watering 6 percentage points to 25 per cent in 2023.
This was the main fiscal measure in a budget that started the clock on decades of struggle to cover the £400bn-plus cost of coping with coronavirus. Corporation tax is ultimately paid by investors, customers and employees. But it remains a telling proxy for a government’s attitude to business. In reversing George Osborne’s successive cuts, Sunak warned companies, many of them rescued by state support, to expect no more favours.
A double take was merited both by the scale of the increase and the chancellor’s decision to take it in one slug. By the end of this parliament the increase would account for 60 per cent of all fresh tax-raising measures, according to Chris Sanger of EY.