8 ms·

Brexit: George Osborne pledges to cut corporation tax

27 points by bontoJR 10y ago

peteretep 10y ago
Maybe better to link to the free: http://www.bbc.com/news/business-36699642 http://www.bbc.com/news/business-36699642
- dang 10y ago
  Ok, we changed to that from http://www.ft.com/cms/s/0/d5aedda0-412e-11e6-9b66-0712b3873ae1.html http://www.ft.com/cms/s/0/d5aedda0-412e-11e6-9b66-0712b3873a.... But it's still too purely political an article for HN.
peteretep 10y ago
> would be seen as in effect the start of Brexit > negotiations No, as much as I was pro-Remain, and as much as I have sympathy for their perspective, the start of Brexit negotiations was this: > "No informal EU talks before Britain invokes Article > 50, says Germany"[0] [0] http://www.reuters.com/article/us-britain-eu-germany-idUSKCN0ZD132 http://www.reuters.com/article/us-britain-eu-germany-idUSKCN...
- 263919121 10y ago
  I understand that position. Why should everyone waste time on negotiating if there is the very real possibility that Britain backpedals and stays?
  - peteretep 10y ago
    The position is easily understood, but that doesn't mean it wasn't the first salvo in negotiation.
    - jacquesm 10y ago
      I think that from an EU perspective the first salvo was the decision to keep a referendum.
      - peteretep 10y ago
        Nobody - including the Conservatives - thought they would win a majority, and that it would have to be followed through.
        jacquesm 10y ago
        There is a risk in bringing a gun to a meeting, if you start brandishing it and it goes off you can't really blame anybody but yourself. It's the summit of irresponsibility.
        lagadu 10y ago
        It's non-binding, technically it doesn't have to be followed through. Regardless, it's not the EU's fault that the leaver leadership thought that political sabre-rattling would be more important than actually having a plan.
- lagadu 10y ago
  You're saying they shouldn't? Seems a fairly straightforward strategy: by calling them out on it, they either force the UK to step up and invoke article 50 or to have their bluff called out. Both outcomes weaken the UK's ability to negotiate and remove the threat of leaving from the table as a weapon the UK could use. Seems like a decent plan, why would they possibly want to negotiate something with the UK, only for them to potentially make a heel-face turn and not leave? In other words, they have very little, if anything, to gain by negotiating anything before the UK makes a move.
  - peteretep 10y ago
    > You're saying they shouldn't No, I'm saying it was positioining, and unambiguously the declaration itself was the start of negotiations, just as threatening to slash corporation tax in the UK is also a negotiating position.
    - lagadu 10y ago
      Ah yea, I agree: both are fairly aggressive moves.
  - crdoconnor 10y ago
    >You're saying they shouldn't? Seems a fairly straightforward strategy: by calling them out on it, they either force the UK to step up and invoke article 50 or to have their bluff called out. Both outcomes weaken the UK's ability to negotiate and remove the threat of leaving from the table as a weapon the UK could use. Which would make sense if it was the EU's primary intention is to punish the UK for having the audacity to leave. >In other words, they have very little, if anything, to gain by negotiating anything before the UK makes a move. By being up front about precisely what an exit will entail it will reduce uncertainty about the outcome for everybody. That's a strong benefit. If EU wants to be vindictive it can try but it probably will be economically damaging (both to the UK and the EU). That will only serve to give Farage-equivalent politicians in the EU enough ammunition to call for their own referendums and before you know it the EU is no more. Edit: disagree by all means but please disagree with something I actually said rather than some crazy thing the leave campaign came up with or some rubbish you "implied" from what I said that I clearly didn't.
ionised 10y ago
I would prefer they raised it to 90%.
- harel 10y ago
  Any why is that?
  - Singletoned 10y ago
    He probably lives in Europe and wants all the UK companies to flee there.
    - harel 10y ago
      Most likely, but still, I find seeking the misfortune of others is a sad state of mind, usually reserved to those on the lower end of the self esteem scale.
      - ionised 10y ago
        Your armchair psychology is cute but I'm just pissed at what I view as half a century or more of deregulation and tax cuts geared towards big businesses and the wealthy and privileged, always at the expense of the poorest in society.
        Singletoned 10y ago
        To be fair, the poorest in society are a LOT better off now than they were 50 years ago.
        ionised 10y ago
        You could say that about anything though. Just because they are better off now in relative terms, it doesn't justify how much more of the share in terms of land, resources and overall wealth the rich and and elite are taking for themselves.
wrong_variable 10y ago
This is going to be similar to the Kansas Experiment but a scaled up version. Can Britain really afford to cut taxes ? It has already cut services to the bone, while running a large twin deficit. Ireland can afford lower tax rates because its such a small country - Dublin is nothing like London and can survive on low investment, and Ireland does not have complex public health service like the NHS. Also lower rates really doesn't mean anything if you are unable to access customers. What Brexit represents is a demand shock to British business, a kind of deflation that has caused the collapse of society in the past. A market of 55 million people is too small for doing any serious 21st Century type globalized business.
- bbrazil 10y ago
  > Ireland does not have complex public health service like the NHS. Ireland has a complex public health system whose cost is comparable to the NHS, it is however not of the same quality.
  - talideon 10y ago
    10% of GDP, IIRC, which is more than the NHS and for worse outcomes. If anything, the Irish system is more complex because of the legacy of being formerly Church-dominated and decades of half-hearted reforms. There's a reason why the Irish health system has long been nicknamed 'Angola'.
- mrmffh 10y ago
  Lower rates can equal a larger absolute cut.
- peteretep 10y ago
  > Can Britain really afford to cut taxes Can it afford tax revenue lost via business fleeing? The answer is probably no to both, but one offers increased employment as a side-effect. It's a plan for making lemonade.
- UK-AL 10y ago
  If it gets more companies here and more people employed, it can actually increase the amount of tax.
bertil 10y ago
Announcing that prior to negotiation is on par to Farage insulting his peers or having the Leave team back-stab each other, or lying furiously throughout the campaign: UK’s main commercial and HR assets are tied to its relationship with the Europe Union. Sabotaging that ahead of negotiation sounds incredibly misinformed. The key player in those talks, Germany, openly wants the crown jewels: the banking sector; Chancellor Merkel has already started playing hardball to get it. How is looking less prepared going to help?
- pluma 10y ago
  If the SNP wouldn't value friendship within the Union now would be a great time to negotiate with English companies to move to Scotland assuming that Scotland secedes. I'd imagine the transition from England to an independent Scotland in the EU is even easier than to, say, Éire.
- hjrnunes 10y ago
  How/when did Farage insult his peers (I presume you're talking of MEPs?)
  - lucozade 10y ago
    Last week when he said that most of them had never had proper jobs [0]. [0] http://www.theguardian.com/politics/video/2016/jun/28/nigel-farages-full-speech-to-meps-most-of-you-have-never-done-a-proper-job-video http://www.theguardian.com/politics/video/2016/jun/28/nigel-...
jamiethompson 10y ago
The kind of businesses that they're worried might flee are the large corporations that evade almost all taxation anyway. To announce something like this right now is as foolish as Theresa May refusing to guarantee the status of non-British EU nationals currently living in the UK. I am ashamed of this country and am applying for Polish citizenship as soon as possible.
- retube 10y ago
  Serious: how is Theresa May (or any politician) supposed to be able to guarantee the status of EU nationals right now? There are several million British people in Europe who are at risk of being kicked out. Obviously their status needs to be defended.
  - jamiethompson 10y ago
    She can't. No one can. But she could have diffused the uncertainty by reassuring the many EU citizens in the UK and the many British citizens living in the EU that, of course, the government would seek a deal which protected their status.
    - tonyedgecombe 10y ago
      Notice that uncertainty is being stirred up by an opposition politician from Scotland, expect a lot of this until the whole thing has been resolved.
      - jamiethompson 10y ago
        I'm guessing you mean Nicola Sturgeon the Scottish First Minister?
    - retube 10y ago
      But that's exactly what she did say - she said she'd do everything she could to protect them but couldn't guarantee it.
- 10y ago
arviewer 10y ago
So the fight has started! Interesting to see how Ireland is going to react. And then what effect will this have on the negotiations? On second thought - this is probably not a fight. This is probably not even a plan. This is the result of not having any plans, no vision, except for letting the market dictate what to do. Do they want a healthy relation with the EU? I guess not!
- danieltillett 10y ago
  Yep I can't see Ireland being too keen on this "plan". It is not like the UK has to get unanimity on every point from every country in the EU. At this point I think the UK would be better off just pulling the thermonuclear option and withdrawing without negotiating at all. Get the economic shock (depression) over quickly and then negotiate new trade agreements over time. Why waste two years in dithering dragging out the uncertainty to end up with nothing.
return0 10y ago
15% is quite low. it brings them to tax-haven territory. That will show the corporate elites running the EU! /s But don't forget there are countries with lower taxation in the EU (10% in bulgaria). UK can do better!
amai 10y ago
They should lower the tax rate for corporations to 0%. Because if corporations don't pay taxes politics doesn't need to care about them so much. "He who doesn't pay the piper doesn't call the tune."
- _Understated_ 10y ago
  Agreed. Corporations don't pay corporation tax anyway: People do. As an example, if suddenly corp tax jumped by 20%, prices would jump by 20% to cover it so customers must pay an additional 20% for the product.
- mxfh 10y ago
  In my experience the leverage for influence was seldomly the tax money alone, more often the number of domestic jobs dependent on the branch plays an even more important role.
- return0 10y ago
  Even better, a company can buy a country and we have the first corporate paradise in the world.
oneloop 10y ago
I'd like to remind everyone that in the USA corporate tax is a humongous 35% rederal, plus state. The point being that there's other ways to attract business that are more effective at growing revenue than cutting tax.

27 points by bontoJR 10y ago

peteretep 10y ago

Maybe better to link to the free: http://www.bbc.com/news/business-36699642 http://www.bbc.com/news/business-36699642

dang 10y ago
Ok, we changed to that from http://www.ft.com/cms/s/0/d5aedda0-412e-11e6-9b66-0712b3873ae1.html http://www.ft.com/cms/s/0/d5aedda0-412e-11e6-9b66-0712b3873a.... But it's still too purely political an article for HN.

peteretep 10y ago

> would be seen as in effect the start of Brexit > negotiations No, as much as I was pro-Remain, and as much as I have sympathy for their perspective, the start of Brexit negotiations was this: > "No informal EU talks before Britain invokes Article > 50, says Germany"[0] [0] http://www.reuters.com/article/us-britain-eu-germany-idUSKCN0ZD132 http://www.reuters.com/article/us-britain-eu-germany-idUSKCN...

263919121 10y ago
I understand that position. Why should everyone waste time on negotiating if there is the very real possibility that Britain backpedals and stays?
- peteretep 10y ago
  The position is easily understood, but that doesn't mean it wasn't the first salvo in negotiation.
  - jacquesm 10y ago
    I think that from an EU perspective the first salvo was the decision to keep a referendum.
    - peteretep 10y ago
      Nobody - including the Conservatives - thought they would win a majority, and that it would have to be followed through.
      - jacquesm 10y ago
        There is a risk in bringing a gun to a meeting, if you start brandishing it and it goes off you can't really blame anybody but yourself. It's the summit of irresponsibility.
      - lagadu 10y ago
        It's non-binding, technically it doesn't have to be followed through. Regardless, it's not the EU's fault that the leaver leadership thought that political sabre-rattling would be more important than actually having a plan.
lagadu 10y ago
You're saying they shouldn't? Seems a fairly straightforward strategy: by calling them out on it, they either force the UK to step up and invoke article 50 or to have their bluff called out. Both outcomes weaken the UK's ability to negotiate and remove the threat of leaving from the table as a weapon the UK could use. Seems like a decent plan, why would they possibly want to negotiate something with the UK, only for them to potentially make a heel-face turn and not leave? In other words, they have very little, if anything, to gain by negotiating anything before the UK makes a move.
- peteretep 10y ago
  > You're saying they shouldn't No, I'm saying it was positioining, and unambiguously the declaration itself was the start of negotiations, just as threatening to slash corporation tax in the UK is also a negotiating position.
  - lagadu 10y ago
    Ah yea, I agree: both are fairly aggressive moves.
- crdoconnor 10y ago
  >You're saying they shouldn't? Seems a fairly straightforward strategy: by calling them out on it, they either force the UK to step up and invoke article 50 or to have their bluff called out. Both outcomes weaken the UK's ability to negotiate and remove the threat of leaving from the table as a weapon the UK could use. Which would make sense if it was the EU's primary intention is to punish the UK for having the audacity to leave. >In other words, they have very little, if anything, to gain by negotiating anything before the UK makes a move. By being up front about precisely what an exit will entail it will reduce uncertainty about the outcome for everybody. That's a strong benefit. If EU wants to be vindictive it can try but it probably will be economically damaging (both to the UK and the EU). That will only serve to give Farage-equivalent politicians in the EU enough ammunition to call for their own referendums and before you know it the EU is no more. Edit: disagree by all means but please disagree with something I actually said rather than some crazy thing the leave campaign came up with or some rubbish you "implied" from what I said that I clearly didn't.

ionised 10y ago

I would prefer they raised it to 90%.

harel 10y ago
Any why is that?
- Singletoned 10y ago
  He probably lives in Europe and wants all the UK companies to flee there.
  - harel 10y ago
    Most likely, but still, I find seeking the misfortune of others is a sad state of mind, usually reserved to those on the lower end of the self esteem scale.
    - ionised 10y ago
      Your armchair psychology is cute but I'm just pissed at what I view as half a century or more of deregulation and tax cuts geared towards big businesses and the wealthy and privileged, always at the expense of the poorest in society.
      - Singletoned 10y ago
        To be fair, the poorest in society are a LOT better off now than they were 50 years ago.
        ionised 10y ago
        You could say that about anything though. Just because they are better off now in relative terms, it doesn't justify how much more of the share in terms of land, resources and overall wealth the rich and and elite are taking for themselves.

wrong_variable 10y ago

This is going to be similar to the Kansas Experiment but a scaled up version. Can Britain really afford to cut taxes ? It has already cut services to the bone, while running a large twin deficit. Ireland can afford lower tax rates because its such a small country - Dublin is nothing like London and can survive on low investment, and Ireland does not have complex public health service like the NHS. Also lower rates really doesn't mean anything if you are unable to access customers. What Brexit represents is a demand shock to British business, a kind of deflation that has caused the collapse of society in the past. A market of 55 million people is too small for doing any serious 21st Century type globalized business.

bbrazil 10y ago
> Ireland does not have complex public health service like the NHS. Ireland has a complex public health system whose cost is comparable to the NHS, it is however not of the same quality.
- talideon 10y ago
  10% of GDP, IIRC, which is more than the NHS and for worse outcomes. If anything, the Irish system is more complex because of the legacy of being formerly Church-dominated and decades of half-hearted reforms. There's a reason why the Irish health system has long been nicknamed 'Angola'.
mrmffh 10y ago
Lower rates can equal a larger absolute cut.
peteretep 10y ago
> Can Britain really afford to cut taxes Can it afford tax revenue lost via business fleeing? The answer is probably no to both, but one offers increased employment as a side-effect. It's a plan for making lemonade.
UK-AL 10y ago
If it gets more companies here and more people employed, it can actually increase the amount of tax.

bertil 10y ago

Announcing that prior to negotiation is on par to Farage insulting his peers or having the Leave team back-stab each other, or lying furiously throughout the campaign: UK’s main commercial and HR assets are tied to its relationship with the Europe Union. Sabotaging that ahead of negotiation sounds incredibly misinformed. The key player in those talks, Germany, openly wants the crown jewels: the banking sector; Chancellor Merkel has already started playing hardball to get it. How is looking less prepared going to help?

pluma 10y ago
If the SNP wouldn't value friendship within the Union now would be a great time to negotiate with English companies to move to Scotland assuming that Scotland secedes. I'd imagine the transition from England to an independent Scotland in the EU is even easier than to, say, Éire.
hjrnunes 10y ago
How/when did Farage insult his peers (I presume you're talking of MEPs?)
- lucozade 10y ago
  Last week when he said that most of them had never had proper jobs [0]. [0] http://www.theguardian.com/politics/video/2016/jun/28/nigel-farages-full-speech-to-meps-most-of-you-have-never-done-a-proper-job-video http://www.theguardian.com/politics/video/2016/jun/28/nigel-...

jamiethompson 10y ago

The kind of businesses that they're worried might flee are the large corporations that evade almost all taxation anyway. To announce something like this right now is as foolish as Theresa May refusing to guarantee the status of non-British EU nationals currently living in the UK. I am ashamed of this country and am applying for Polish citizenship as soon as possible.

retube 10y ago
Serious: how is Theresa May (or any politician) supposed to be able to guarantee the status of EU nationals right now? There are several million British people in Europe who are at risk of being kicked out. Obviously their status needs to be defended.
- jamiethompson 10y ago
  She can't. No one can. But she could have diffused the uncertainty by reassuring the many EU citizens in the UK and the many British citizens living in the EU that, of course, the government would seek a deal which protected their status.
  - tonyedgecombe 10y ago
    Notice that uncertainty is being stirred up by an opposition politician from Scotland, expect a lot of this until the whole thing has been resolved.
    - jamiethompson 10y ago
      I'm guessing you mean Nicola Sturgeon the Scottish First Minister?
  - retube 10y ago
    But that's exactly what she did say - she said she'd do everything she could to protect them but couldn't guarantee it.
10y ago

arviewer 10y ago

So the fight has started! Interesting to see how Ireland is going to react. And then what effect will this have on the negotiations? On second thought - this is probably not a fight. This is probably not even a plan. This is the result of not having any plans, no vision, except for letting the market dictate what to do. Do they want a healthy relation with the EU? I guess not!

danieltillett 10y ago
Yep I can't see Ireland being too keen on this "plan". It is not like the UK has to get unanimity on every point from every country in the EU. At this point I think the UK would be better off just pulling the thermonuclear option and withdrawing without negotiating at all. Get the economic shock (depression) over quickly and then negotiate new trade agreements over time. Why waste two years in dithering dragging out the uncertainty to end up with nothing.

return0 10y ago

15% is quite low. it brings them to tax-haven territory. That will show the corporate elites running the EU! /s But don't forget there are countries with lower taxation in the EU (10% in bulgaria). UK can do better!

amai 10y ago

They should lower the tax rate for corporations to 0%. Because if corporations don't pay taxes politics doesn't need to care about them so much. "He who doesn't pay the piper doesn't call the tune."

_Understated_ 10y ago
Agreed. Corporations don't pay corporation tax anyway: People do. As an example, if suddenly corp tax jumped by 20%, prices would jump by 20% to cover it so customers must pay an additional 20% for the product.
mxfh 10y ago
In my experience the leverage for influence was seldomly the tax money alone, more often the number of domestic jobs dependent on the branch plays an even more important role.
return0 10y ago
Even better, a company can buy a country and we have the first corporate paradise in the world.

oneloop 10y ago

I'd like to remind everyone that in the USA corporate tax is a humongous 35% rederal, plus state. The point being that there's other ways to attract business that are more effective at growing revenue than cutting tax.