Impact of Increasing Corporation Tax
Impact Area | Impact Expected by Supporters | View by Supporters on the Perceived Desirability of this outcome | Impact Expected by Opponents | View by Opponents on the Perceived Desirability of this outcome | Nature of Disagreement |
---|---|---|---|---|---|
Government Revenue | Increase in tax revenue | Positive, provides more funds for public services and infrastructure | Increase in tax revenue | Negative, reduces funds available for business investment and growth | 2) Agree on impact, disagree on desirability |
Business Investment | Potential decrease | Acceptable trade-off for increased public spending | Significant decrease | Negative, hinders economic growth and job creation | 1) Disagree on extent of expected impact |
Economic Growth | Limited or short-term effect | Outweighed by benefits of public investment | Negative impact on growth | Harmful to overall economic performance | 1) Disagree on extent of expected impact |
Job Creation | Limited effect | Offset by public sector investment and spending | Negative impact on job creation | Harmful to employment, particularly in private sector | 1) Disagree on extent of expected impact |
Income Inequality | Potential decrease | Positive, as increased public spending can benefit lower-income groups | Potential increase | Negative, as higher taxes may be passed on to consumers and workers | 2) Agree on impact, disagree on desirability |
Public Services | Increase in funding | Positive, allows for better public services and infrastructure | Potential decrease in funding | Negative, if economic growth is hampered and tax revenue decreases | 1) Disagree on extent of expected impact |
Tax System Complexity | Potential increase | Acceptable trade-off for increased revenue | Potential increase | Negative, as companies may seek ways to minimize tax burden | 2) Agree on impact, disagree on desirability |
International Competitiveness | Potential decrease | Acceptable trade-off for increased public investment | Significant decrease | Negative, as companies may relocate to lower-tax jurisdictions | 1) Disagree on extent of expected impact |
Impact of Reducing Corporation Tax
Impact Area | Impact Expected by Supporters | View by Supporters on the Perceived Desirability of this outcome | Impact Expected by Opponents | View by Opponents on the Perceived Desirability of this outcome | Nature of Disagreement |
---|---|---|---|---|---|
Business Investment | Increase in investment and economic activity | Positive, stimulates economic growth and job creation | Limited impact on domestic investment | Negative, benefits may accrue to multinational corporations | 1) Disagree on extent of expected impact |
Employment | Increase in job opportunities | Positive, leads to higher employment and incomes | Limited job creation, mainly in certain sectors | Negative, may lead to job losses in other sectors | 1) Disagree on extent of expected impact |
Government Revenue | Short-term decrease, long-term increase | Acceptable trade-off for economic growth | Significant decrease in tax revenue | Negative, undermines funding for public services | 2) Agree on impact, disagree on desirability |
Business Competitiveness | Improved domestic and international competitiveness | Positive, attracts foreign investment and business relocation | Limited impact on competitiveness | Negative, may lead to tax competition and a race to the bottom | 1) Disagree on extent of expected impact |
Income Inequality | Likely to increase in the short term | Not a significant concern; focus on overall growth | Likely to increase in the long term | Major concern; exacerbates existing inequalities | 2) Agree on impact, disagree on desirability |
Public Services | Potential reduction in the short term | Offset by increased private sector activity | Significant reduction in funding | Harmful to essential services and infrastructure | 2) Agree on impact, disagree on desirability |
Tax Avoidance | Limited impact or potential decrease | Positive, reduces incentives for tax avoidance | Potential increase in tax avoidance practices | Negative, erodes tax base and fairness | 1) Disagree on extent of expected impact |
Long-term Fiscal Health | Improvement due to economic expansion | Positive, strengthens fiscal position | Deterioration due to decreased tax revenue | Negative, worsens budgetary deficits and debt | 1) Disagree on extent of expected impact |