CBI warns Brown not to damage UK competitiveness

Manufacturing News, Source : British Industry
Published : 11 Nov 2002 10:58

The relentless rise in business taxation is damaging UK business, the Confederation of British Industry (CBI) has warned Gordon Brown.

Business taxation is expected to cost British firms an additional £47 billion between 1997 and 2005, a rising tax burden which has contributed substantially to a squeeze on corporate finances, along with the build up of regulation and sluggish economic growth.

The CBI also points out that firms would have been £30 billion better off during the last year had profits risen since 1996-1997 in line with GDP, a shortfall that is hitting investment and employment across the economy.

Manufacturing has been particularly badly hit with profitability falling by 11 per cent between the start of 1998 and the end of last year, double the decline in the 1990s recession.

Digby Jones, director-general of the CBI, said: “Ministers cannot keep siphoning off company funds without damaging investment, productivity and competitive. That will reduce the ability for the government to invest in public services – the money will simply not be there.”

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