London: Prime Minister Rishi Sunak rejected calls from his own ruling Conservative Party to cancel a rise in UK corporation tax due to come into force next month, according to a person familiar with government plans.
The levy on business profit is scheduled to rise from 19% to 25% in April, prompting demands to stop the increase in a bid to encourage investment. Last week, former Prime Minister Boris Johnson publicly called for UK corporation tax rates to match Irish levels or lower, arguing Sunak is not exploiting the benefits of leaving the European Union.
Supporters of former Prime Minister Liz Truss, who have formed a Conservative Growth Group, have also asked Chancellor of the Exchequer Jeremy Hunt to halt the planned rise, according to a person familiar with their submission to the Treasury.
Buoyed by widespread support for the Brexit deal signed with the European Union last week, Sunak is in an increasingly strong position to stare down Tory detractors over his budget plans.
During his own term as Chancellor, Sunak planned a targeted relief for business investment to operate alongside the headline tax rise. There is no similar plan in place at the moment but Hunt has said business tax cuts are his priority.