§ Mr. Andrew TurnerTo ask the Chancellor of the Exchequer how much additional income has been realised by the Exchequer as a result of his most recent changes to advance corporation tax. [40280]
§ Dawn PrimaroloAdvance corporation tax was abolished with effect from April 1999. The abolition did not in itself give rise to additional yield to the Exchequer.
The abolition of advance corporation tax was part of a package of reforms that included the abolition of payable tax credits on dividends and cuts in corporation tax rates. These changes were designed to boost corporate investment by removing tax distortions and to improve the climate for quality long-term investment. The figures of cost and yield for these reforms were given in the FSBR for the July 1997 and March 1998 Budgets.