UK businesses are about to receive an extra £9bn a year in tax at the same time as most face a reduction in government subsidies on their energy bills, in what business groups are calling a ” week of woe.”

The main corporate tax rate will rise from 19% to 25% from April, raising some £18bn a year for the Treasury, but that will be partly offset by a 100% tax break on designed capital spending. to boost investment.

The so-called full expense tax extent announced in the March Budget is worth around £9bn a year, leaving businesses around £9bn a year, or £750m a month, worse.

Tim Sarson, KPMG’s director of tax policy, said the “strongest effect” will be felt by those companies that accept the full 6 percentage point tax increase without being able to benefit from the full amount of capital spending.

He added that parts of the service sector would be among the hardest hit, as they do not need to invest as much in plant and machinery.

Businesses will also face a sharp cut in government support for energy bills from April 1, while the living wage is set at raise by 9.7 percent.

The Federation of Small Businesses said businesses would be £12.5bn worse off after the reduction in aid for energy bills, as the cost of the scheme to taxpayers will be reduced to £5.5bn over 12 months compared to 18,000 million pounds during the last half year.

Many smaller companies will also see a cut in research and development tax breaks from April, while they become more generous for larger companies. The net effect of these changes is expected to remove around £215m in support in the new fiscal year.

“Sadly, the Conservative Party is about to plunge UK small businesses into a week of grief. Taxes go up, energy bills go up, labor costs go up, inflation goes up, but the government doesn’t notice and now it’s running out of avenues to make a difference,” he said. Craig Beaumont, head of external affairs for the FSB

Other business leaders also criticized the government for raising corporate tax.

Lord Karan Bilimoria, founder of Cobra Beer and former CBI chairman, said it was “absolutely the wrong move” and was “backward, retrograde, [and] It will hurt the investment.

He added that he was “shortsighted in trying to pocket £18bn a year, when in reality he is killing the goose that lays the golden eggs”.

Lord Michael Spencer, founder of interdealer broker ICAP and a Tory donor, said: “The UK should keep corporate tax to no more than 20 per cent to put us in the most competitive group globally.

“The UK is simply not an attractive enough place to invest with a 25 per cent corporation tax.”

Penny Simmons, legal director of the law firm Pinsent Masons, said the corporate tax increase “is going to hit big companies hard.”

Tim Stovold, head of tax at accountants Moore Kingston Smith, said companies with profits between £50,000 and £250,000 would be hit with a marginal corporate tax rate of 26.5 per cent due to decreased relief between those bands. “Most don’t expect this; It will be a shock.”

Companies with profits below £50,000 will continue to pay 19 per cent corporation tax and the main rate will apply to all profits above £250,000.

The British Metalforming Confederation has warned that hundreds of small manufacturers could be forced out of business with the cut in support for energy bills.

“The government is sleepwalking into an industrial disaster, it’s that simple,” said Chief Executive Stephen Morley.

“There are well-run companies that have seen their energy bills rise from £600,000 a year to £4.2m and from £4.3m to almost £6.8m. How can you expect them to be absorbed and still survive or remain competitive?

The government said several measures it had announced, such as full tax breaks and business tax relief, would help boost investment and spur growth.

“We are determined to make the UK the best place in the world to do business, which is why, from today, companies can start taking advantage of the vast amount of tax breaks on offer to fuel their growth.” said Victoria Atkins, the Treasury’s financial secretary.

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