§ Mr. MacleanTo ask the Chancellor of the Exchequer how many businesses have been affected, and by what average amount, as a result of the reduction in the(a) main and (b) small firms rate of corporation tax in the 1997 and 1998 budgets. [70674]
§ Dawn PrimaroloThe reductions in the main rate of corporation tax will benefit some 40,000 companies and the reductions in the small companies' rate will benefit some 360,000 companies. The full effect of the April 1997 rate cuts will occur only in payments made in 1999–2000 and similarly the full effect of the small companies' rate cut in April 1999 will occur only in payments made in 2000–01. The 1 per cent. cut in the main rate in April 1999 will start to have an effect from 1999–2000 as these companies will by then be partly paying tax in quarterly instalments.
596WThe expected average gain for each type of company as a result of the tax cuts is given for each budget in the tables:
1997 Budget £ Average reduction in payment per company in: 1998–99 1999–2000 Cut in main rate from 33 per cent, to 31 per cent, on 1 April 1997 35,000 49,000 Cut in small companies' rate from 23 per cent, to 21 per cent, on 1 April 1997 500 700
1998 Budget £ Average reduction in payment per company in: 1999–2000 2000–01 2001–02 Cut in main rate from 31 per cent, to 30 per cent, on 1 April 1999 7,500 25,000 27,500 Cut in small companies' rate from 21 per cent, to 20 per cent, on 1 April 1999 neg 250 350