Treasury releases details of business tax reforms

Following consultations in July, the Treasury has published two technical notes detailing the draft legislation proposals. The Treasury says changes to business tax are aimed at improving the UK’s international competitiveness and to reflect modern business activity, including the need to be more environmentally friendly. The major measures proposed are a reduction of the main rate of corporation tax (CT) from 30% to 28%, while raising the small companies’ rate to 22% by April 2009. The main rate of capital allowances for plant and machinery is to be reduced to 20%, while allowances on l...