Tax burden still too high, says IoD

The lobbying group claimed the real rates of corporation tax are well above the current levies of 20 and 26 per cent.

Small and medium-sized enterprises are facing true tax rates of between 32 and 43 per cent, the IoD said, arguing that the Treasury’s planned cuts would do “little or nothing” to help smaller firms.

Margaret Wood, regional chairman of the IoD, said the coalition was failing the business community.

“If this Government is adamant that the private sector is going to regenerate the economy through growth and investment then it should be reducing the tax burden and it has not done that.

“Despite its protestations the tax burden is still too high and one of the biggest hurdles to regeneration is that we cannot afford to employ people because of the high tax of doing so.

“The Government should be coming to business and asking how we can support it but instead it is telling us how we must support it.”

The IoD’s report, entitled Tax – the weighty burden, said the profits made by companies in the first four or five months of the year are being drained by the state.

Stealth taxes are also hitting businesses as they try to climb out of recession, Mrs Wood added.

“There are a lot of factors affecting our recovery not least of which are inflation and the unseen taxes business has to pay.”

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