Will the UK’s new 50 per cent income tax rate for high earners raise the additional revenue the government needs to restore its balance sheet? Or will the higher tax rate prove counterproductive by encouraging owner managers to sell their business, work less or move elsewhere? And will the government’s next move be to raise capital gains tax?
These are the questions that Clearwater Corporate Finance is asking entrepreneurs in its new online survey. Phil Burns of Clearwater says: “The government is hoping that the new higher income tax rate due to come into force in April 2010 will help it claw back lost tax revenue caused by the recession.
“However anecdotal experience from the 1970s, when income tax rates reached 80 per cent or more, suggests the effect could be counterproductive. And if higher tax does fail to raise the desired amount, the government may have to look for other ways to raise revenues. We’d like to know what business owners, managers and advisers think about these issues and gather an informed body of opinion.”
To give your opinion, please take part in our survey.