Does the CBI want higher taxes or lower taxes? This morning its director general, Tony Danker, complained that the rise in corporation tax from 19 per cent to 25 per cent is in danger of killing off economic growth. He also demanded at the very minimum that a ‘super-deduction’ – where businesses can cut their tax bill by 25 pence for every pound invested – be maintained.
‘We know the economy can – and must – break out of its low growth trap, but we need action of business investment to achieve it,’ he said. ‘Firms are seeing the end to super-deduction with nothing to replace it but a big rise in corporation tax. This will have a huge impact on investment and leave the UK falling behind its global competitors.’
The CBI cheered tax cuts and then, when markets reacted badly, it rolled back its support
Danker is right is his assessment: but is the CBI willing to defend it when the political storms come? Initially, the CBI welcomed Kwasi Kwarteng’s mini-Budget last September.
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