Recent statistics have revealed that the largest UK businesses paid £80.5 billion in taxes this year, despite recent corporation tax cuts.
Produced by PwC, the survey of FTSE 100 businesses’ finance directors shows a rise from the £80 billion tax figure recorded in 2014.
The report also showed that the total tax rate, which works as a measure of tax compared to profit, currently stands at 42.9 per cent, up by 1.5 per cent from last year.
It also represents a massive rise from the 2008 figure of 38.2 per cent.
Another finding from the survey was that business rates have taken over corporation tax as a greater financial burden for businesses, and they are now the second largest tax that big companies have to pay.
On average, business rates are responsible for 21 per cent of the largest companies’ tax bills, whereas corporation tax now stands at approximately 18.3 per cent.
The news means that financial difficulties may lie ahead for the UK’s retail businesses, unless they meticulously plan their finances, because of the fact that they usually employ many people across a chain of properties.
A number of new Government policies are also expected to have an impact on British businesses, including the apprenticeship levy and national living wage.
The head of employment and skills policy at the Institute of Directors – Seamus Nevin – said: “The Chancellor’s £1 billion living wage is not the only extra cost businesses have been hit with. A new payroll tax, in the form of the apprenticeship levy, will cost employers £12 billion over the course of the parliament, while the next tranche of pensions auto-enrolment will affect the very smallest businesses.
“This is not to mention a number of significant additional reporting requirements firms will have to comply with. The cumulative effect of these will be considerable, particularly for those medium-sized businesses that just meet the threshold for compliance.”