Profits down but the big 100 companies still paid £500m more in taxes last year
The 100 Group, which represents the views of FTSE 100 finance directors, said the increase came despite a decline in their UK profits.
Total tax contributions rose from £77.1bn to £77.6bn.
It said the increase is predominantly due to higher employment taxes, VAT and excise duties.
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Hide AdThis is the first time that corporation tax is not the largest tax paid by the UK’s bigger employers.
Robin Freestone, chairman of the 100 Group, said: “The total tax contribution of Britain’s biggest businesses increased in the year to March 2013, despite challenging economic conditions at that time.
“The Government’s rebalancing of business taxes away from corporation tax appears to have played a role in helping to incentivise increased levels of UK employment, as well as investment and research and development. These are now helping to stimulate UK economic activity and growth.”
Gordon Singer, tax partner at PwC in Leeds, said: “The reduction of corporation tax is about making the UK competitive and boosting economic growth across the whole country.
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Hide Ad“The 100 Group represents businesses across all sectors and all regions of the UK, and their increased overall tax contribution is an indication that these policies are working.
“Looking at the full picture of tax paid by business, you see that tax on profits have fallen while taxes on labour and property have increased. This is a global trend. By cutting the corporation tax rate, the Government is becoming less dependent on profit-related tax. This creates a more stable tax base.”
The 100 group said that taxes represent only one element of the wider contribution to the UK economy by the UK’s largest companies.
The companies employ over 2.1m people (7.2 per cent of the UK workforce) who have seen an average wage increase of 2.5 per cent.
They have invested over £26bn in fixed assets (21.4 per cent of UK business investment) and over £5bn in business Research and Development (31.1 per cent of UK business R&D spend).