New business taxes introduced over the past decade have raised more than £50bn for the government, pushing the UK’s tax burden to its highest level in 70 years.
According to an analysis by Thomson Reuters, reported in The Daily Telegraph, the bank levy, apprenticeship levy, soft drinks tax have all contributed to the Treasury’s coffers.
Meanwhile, the incoming National Insurance rise in April – the health and social care levy – is to add 1.25 percentage points to the tax levied on employers and their employees.
Pressure increasing on businesses at a difficult time
Thomson Reuters’ Jas Sandhu Dade said: “Adding new taxes and placing a heavy burden on businesses comes at a difficult time for those still recovering from the economic impact of the pandemic.
“These new taxes have proven themselves to be a successful way to bring in billions of pounds in a relatively short space of time.
“The new National Insurance surcharge is sure to be a success from a public purse perspective, but will add considerable financial and compliance stresses to both businesses and individuals.”
This sentiment was echoed recently, as it was revealed that UK SMEs are grappling with debt – reported on here.
Evolving taxation system raising billions extra for the Treasury
The health and social care levy is set to raise around £17bn a year. And the bank levy, introduced in 2011 as a charge based on the size of finance giants’ balance sheets, has raised almost £25bn.
The apprenticeship levy raises £10.7bn from big employers, followed by the bank corporation tax surcharge, which came into force in 2016 to stop financiers benefitting from cuts to corporation tax. This has raised £8.2bn.
Also significant are the bank payroll tax, an annual tax on enveloped dwellings, a one-off levy under a tax deal with Switzerland, and the diverted profits tax, says Thomson Reuters.