The cut in mainstream Corporation Tax
won't directly help smaller businesses, but it will help to attract overseas businesses to set up in the UK.
The mainstream corporation tax
rate will fall to 23% this April and 21% from April 2014, making the UK one of the most competitive mainstream corporation tax
rates of major western economies.
And while net finance expense for the first six months is expected to increase due to a pounds 200m index-linked loan with the European Investment Bank and slightly higher inflation costs on its index-linked debt, a deferred taxation credit of pounds 50m is due, following the Government's decision to cut mainstream corporation tax
from 26% to 25%.
Mr Jewkes, tax partner at Grant Thornton in Birmingham, said: "We have known for a long while that the mainstream corporation tax
rate was scheduled to come down, but it is disappointing that this cut will now be introduced in phases.
In order for the UK to stand out from the competition, the Chancellor could announce a programme of future postelection reductions in the mainstream corporation tax
Is it equivalent to 'corporation tax', so as to include ACT, or does it refer only to mainstream corporation tax
and exclude ACT?
EIGHT of the 10 companies had paid no mainstream corporation tax
on their core water and sewerage businesses.
Despite headline announcements in this year's Budget of dropping the basic rate of income tax, aligning national insurance contributions and reducing mainstream corporation tax
, the reality is that other increases will lead to a maintenance of the status quo," said Ms Lagerberg.
Mainstream corporation tax
to be cut from April 2008 to 28p - down from 30p.