New analysis on the tax contribution of FTSE 100 and several other large UK companies for 2022/23 shows that the ‘total tax contribution’ increased by £8.3bn to £89.8bn (amounting to 10% of total government receipts). ‘Total tax contribution’ includes not only taxes borne by a company (e.g. corporation tax, employer NICs and business rates) but also taxes collected (e.g. PAYE) on the basis that the commercial activity of the company gives rise to those taxes which the company then collects on behalf of HMRC.
The research by PwC shows that taxes borne by the largest companies increased to £29.1bn (up from £26.5bn) giving an average total tax rate of 49%, up from 39.9% in the previous year – mainly due to extra employer NICs and the addition of the energy profits levy for some businesses.
Taxes collected increased to £60.6bn, with the largest proportion (31%) coming from employment taxes (income tax and employee NICs), but closely followed by fuel duties (22.5%) and net VAT (22%).
PwC have created a particularly interesting graphic showing how the profile of taxes for large business has changed over the last 19 years, moving away from corporation tax to a more diverse range of other taxes by 2023. For example, in 2005, corporation tax (main rate then 30%) represented 50% of tax paid by large business, but that proportion had fallen to 29% by 2023. The 2022/23 figures do not of course include the 25% main rate of corporation tax which applies from 1 April 2023 and is expected to be reflected in next year’s survey.
PwC’s tax report not only highlights the data on tax, but also presents the findings in the wider context of the contribution the UK’s largest businesses make to society, both in terms of the tax receipts their activities generate (by virtue of creating jobs) and also the investment they make which in turn drives economic growth. 96% of those surveyed also reported that their businesses have a net zero target although, for most, tax policy is not expected to play an important role in their ability meet that target. 68% of respondents did however say that more generous green incentives would have a ‘high or very high’ impact on meeting net zero.
Separately, new data obtained by retail investment firm Wealth Club reveals that Britain’s top 100,000 taxpayers paid 24% of all income and capital gains tax in 2021/22. These taxpayers paid an average income tax and CGT of £559,000 each, which is up 18% from the year before. Alex Davies, the founder of Wealth Club, warned: ‘The wealthy are a mobile bunch. If the top 100 taxpayers up sticks and move to sunnier tax climates, that would be £4.6bn less in tax receipts’.
New analysis on the tax contribution of FTSE 100 and several other large UK companies for 2022/23 shows that the ‘total tax contribution’ increased by £8.3bn to £89.8bn (amounting to 10% of total government receipts). ‘Total tax contribution’ includes not only taxes borne by a company (e.g. corporation tax, employer NICs and business rates) but also taxes collected (e.g. PAYE) on the basis that the commercial activity of the company gives rise to those taxes which the company then collects on behalf of HMRC.
The research by PwC shows that taxes borne by the largest companies increased to £29.1bn (up from £26.5bn) giving an average total tax rate of 49%, up from 39.9% in the previous year – mainly due to extra employer NICs and the addition of the energy profits levy for some businesses.
Taxes collected increased to £60.6bn, with the largest proportion (31%) coming from employment taxes (income tax and employee NICs), but closely followed by fuel duties (22.5%) and net VAT (22%).
PwC have created a particularly interesting graphic showing how the profile of taxes for large business has changed over the last 19 years, moving away from corporation tax to a more diverse range of other taxes by 2023. For example, in 2005, corporation tax (main rate then 30%) represented 50% of tax paid by large business, but that proportion had fallen to 29% by 2023. The 2022/23 figures do not of course include the 25% main rate of corporation tax which applies from 1 April 2023 and is expected to be reflected in next year’s survey.
PwC’s tax report not only highlights the data on tax, but also presents the findings in the wider context of the contribution the UK’s largest businesses make to society, both in terms of the tax receipts their activities generate (by virtue of creating jobs) and also the investment they make which in turn drives economic growth. 96% of those surveyed also reported that their businesses have a net zero target although, for most, tax policy is not expected to play an important role in their ability meet that target. 68% of respondents did however say that more generous green incentives would have a ‘high or very high’ impact on meeting net zero.
Separately, new data obtained by retail investment firm Wealth Club reveals that Britain’s top 100,000 taxpayers paid 24% of all income and capital gains tax in 2021/22. These taxpayers paid an average income tax and CGT of £559,000 each, which is up 18% from the year before. Alex Davies, the founder of Wealth Club, warned: ‘The wealthy are a mobile bunch. If the top 100 taxpayers up sticks and move to sunnier tax climates, that would be £4.6bn less in tax receipts’.
