Business tax 'becoming two-tier system'

News Article - 09 November 2006
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Corporation tax is becoming a two-tier system, a new report has warned.

A study conducted jointly by PricewaterhouseCoopers and the World Bank has found that the convoluted way in which corporation taxation rules and regulations are presented means that companies have to seek advice to navigate their way through the details.

Smaller companies cannot always afford advice, meaning that a two-tier system has been created, the report states.

Peter Cussons, a tax partner at PricewaterhouseCoopers, told the Times: "I do not think it can carry on, because non-compliance will increase through sheer ignorance."

Some 8,300 pages of primary tax law must be read by businesses if they are to understand their tax status, compared with 5,000 pages in the US and 1,700 pages in Germany, Accountancy magazine states.

The study found that Britain has the second most complex tax regime out of the 20 biggest economies in the world. India came in first.

Earlier this week a small business pressure group urged the chancellor Gordon Brown to cut corporation tax from 30 per cent to 25 per cent in his pre-Budget report, Shout99.com reports.

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