Manufacturers publish tax manifesto
Published: 20 April, 2010
The UK's tax system is tilted against manufacturing, stands in the way of growing a more balanced economy and needs major reform, according to a major report published by EEF, the manufacturers" organisation.
The report 'Tax reform for a balanced economy’ lays down the gauntlet to the Chancellor and his Shadow counterparts. It sets out reforms, which would provide an immediate boost to high-tech investment and innovation and create an internationally competitive tax system that helps to repair the public finances in the medium term.
EEF warned that a failure to tackle a tax system that not only makes the UK uncompetitive but doesn’t support manufacturing, will fail to help re-balance the economy and will lead to some companies moving their headquarters out of the UK.
Commenting, EEF director of policy, Steve Radley, said: "While there have been some helpful changes to the tax regime in recent years, we still lack a coherent tax system that encourages manufacturers to invest and sends the signal that they should be doing it here. The next government must think and act differently about how the tax system supports manufacturing and a balanced economy. In particular, it can achieve much larger benefits from any new measures if its approach is more predictable and transparent.
“In the short term it means developing a modern, efficient tax system that helps to grow a diverse and dynamic manufacturing base. In the medium term, it means creating a more competitive tax environment to help reduce the number of hard choices we have to make when repairing the public finances.
“A modern, competitive tax system would not only re-balance our economy but attract mobile multinational investment to the UK and send the right signal to would-be investors. The next government of whatever colour must make this a priority.”
EEF’s proposals focus on twin priorities: immediate reforms to boost high-tech investment and innovation; and medium-term reforms to create a competitive tax system.
