2 National tax systems: Structure and recent developments

Transcription

1 2 National tax systems: Structure and recent developments United Kingdom Structure and development of tax revenues Table UK.1: Tax Revenue (% of GDP) Ranking Revenue (billion euros) A. Structure by type of tax Indirect taxes VAT Taxes and duties on imports excluding VAT Taxes on products, except VAT and import duties Other taxes on production Direct taxes Personal income taxes Corporate income taxes Other Social contributions Employers Households Less: capital transfers ( 2 ) n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Total Memo item: Total payable tax credits B. Structure by level of government as % of total taxation Central government State government ( 1 ) n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Local government Social security funds n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. EU institutions C. Structure by economic function as % of GDP Consumption Labour of which on income from employment Paid by employers Paid by employees Paid by non-employed Taxation trends in the European Union DG Taxation and Customs Union

2 National tax systems: Structure and recent developments 2 Table UK.1: Tax Revenue (continued) (% of GDP) Ranking Revenue (billion euros) Capital Income of corporations Income of households Income of self-employed Stock of capital D. Environmental taxes as % of GDP Environmental taxes Energy of which transport fuel taxes : : : Transport Pollution and resources E. Property taxes as % of GDP Taxes on property Recurrent taxes on immovable property Other taxes on property F. Implicit tax rates % Consumption Labour ( 1 ) This level refers to the Länder in Austria and Germany, the gewesten and gemeenschappen / régions et communautés in Belgium, and the comunidades autónomas in Spain. ( 2 ) Representing taxes assessed but unlikely to be collected. Source: DG Taxation and Customs Union, based on Eurostat data. Figure UK.1: Tax revenues by main taxes, compared to EU-28, (in % of GDP) Consumption 15 Social contributions Indirect taxes Capital 10 5 Labour - paid by employers 0 Direct taxes UK Labour - paid by non-employed EU-28 Labour - paid by employees Source: DG Taxation and Customs Union, based on Eurostat data. DG Taxation and Customs Union Taxation trends in the European Union 187

3 2 National tax systems: Structure and recent developments Latest tax reforms Table UK.2: Latest tax reforms Description of measure Change Date Personal income tax Pensions automatic enrolment: align with start of tax year N/A Announcement: 25/11/2015 Increase in personal allowance from GBP in to GBP in Base decrease Announcement: 16/03/ Higher rate threshold: increase to GBP in April 2017 Base decrease Announcement: 16/03/2016 Lifetimes ISA and raise ISA limit to GBP Base decrease Announcement; in force from: 05/04/2017 Asset managers: reform treatment of performance awards N/A Announcement: 16/03/2016 Personal allowance: increase to GBP in , with equal gains to Base decrease Announcement: 08/07/2015 higher rate taxpayers Higher rate threshold: increase to GBP in Base decrease Announcement: 08/07/2015 Corporate income tax Modernising the tax and benefit system: Corporation tax - special rate on Rate increase Announcement: 25/11/2015 restitution payments Business rate: small business relief extension Base decrease Announcement: 25/11/2015 Corporation tax: restrict relief for interest Base increase Announcement: 16/03/2016 Corporation tax: withholding tax on royalties Base increase Announcement: 16/03/2016 Corporation tax: further restrict use of banks pre-2015 losses Base increase Announcement: 16/03/2016 Corporation tax: reform loss relief Base increase Announcement: 16/03/2016 Corporation tax: extend scope of hybrid mismatch rules Base increase Announcement; in force from: 01/01/2017 Corporation tax: defer bringing forward payment for large groups for two years Base neutral Announcement: 16/03/2016 Corporation tax: bringing forward payments for large groups N/A Announcement: 08/07/2015 Value-added tax Value added tax: tackling overseas trader evasion Rate increase Announcement: 16/03/2016 Value added tax: extend reverse charge to electronic communications services N/A Announcement: 16/03/2016 Energy excises Freezing of fuel duties Rate decrease Announcement: 16/03/2016 Climate change levy: equal treatment for generators Base increase Announcement: 08/07/2015 Alcohol excises Freeze in alcohol duties Rate decrease Announcement: 16/03/2016 Tackling illicit tobacco and alcohol N/A Announcement: 08/07/2015 Other, non-harmonised excises Soft drinks industry levy N/A Announcement; in force from: 05/04/2018 n-energy environmental taxes Fuel duty: freeze in April 2016 Rate decrease Announcement: 16/03/2016 Property taxes Stamp duty land tax: higher rates on additional properties Rate increase Announcement: 25/11/2015 Stamp duty land tax: bringing forward payments N/A Announcement: 25/11/2015 Increase in insurance premium tax Rate increase Announcement; in force from: 01/09/2016 Business rates: permanently double the Small Business Rate Relief and extend thresholds Base decrease Announcement; in force from: 01/04/2017 Business rates: increase threshold for higher multiplier to GBP Base decrease Announcement: 16/03/2016 Stamp duty land tax for non-residential property: reform freehold and Rate increase Announcement: 16/03/2016 leasehold premium regime Residential property: restrict finance relief to basic rate, phase from 2017 Rate increase Announcement: 08/07/2015 Residential property: reform wear and tear allowance Base increase Announcement: 08/07/ Taxation trends in the European Union DG Taxation and Customs Union

4 National tax systems: Structure and recent developments 2 Table UK.2: Latest tax reforms (continued) Other types of tax Stamp tax: to stop avoidance of stamp tax where deep in the money options Base increase Announcement: 25/11/2015 are used to transfer depositary receipt issuer or clearance service, reduce opportunities for income to be converted to capital gain Venture capital scheme, restrictions on use: exclude all energy generation Base increase Announcement: 25/11/2015 activities Capital allowance and leasing: reducing avoidance Base increase Announcement: 25/11/2015 Corporation tax: disposals of intangible fixed assets to a related party Base increase Announcement: 25/11/2015 Business, growth and skills: Apprenticeship levy Introduction (increase) Announcement; in force from: 01/04/2017 Company car tax: retain the diesel supplement until 2021 N/A Announcement: 25/11/2015 Insurance premium tax: reform to motor insurance claim rules N/A Announcement: 25/11/2015 Oil and gas - abolish petroleum revenue tax and reduce supplementary charge Both base and rate decrease Announcement: 16/03/2016 to 10% Capital gains tax: reduce basic rate to 10% and main rate to 20% excluding Rate decrease Announcement: 16/03/2016 residential property and carried interest Oil and gas: abolish petroleum revenue tax and reduce supplementary charge Phase-out (decrease) Announcement: 16/03/2016 to 10% Disguised remuneration: tackling historic and new schemes N/A Announcement: 16/03/2016 Insurance premium tax: increase by 0.5% Rate increase Announcement: 16/03/2016 Inheritance tax: GBP 1m couples allowance from 2020 through new main Introduction (decrease) Announcement: 08/07/2015 residence nil-rate band phased in from 2017 Pensions tax relief: restricted for gross income over GBP from Base increase Announcement: 08/07/2015 Annual investment allowance: set at new permanent level of GBP Base decrease Announcement: 08/07/2015 Employment allowance: increase by GBP from Rate decrease Announcement: 08/07/2015 Dividends tax: abolish credit, introduce new GBP allowance, and increase Both base and rate increase Announcement: 08/07/2015 effective rates by 7.5 p.p. Insurance premium tax: increase by 3.5 p.p. to 9.5% Rate increase Announcement: 08/07/2015 n-domiciles: abolition of permanent status Base increase Announcement: 08/07/2015 n-domiciles: IHT on UK residential property Introduction (increase) Announcement: 08/07/2015 Intangible assets: remove relief for new claims Base increase Announcement: 08/07/2015 Employment allowance: withdraw from single person companies Base increase Announcement: 08/07/2015 Capital gains tax: avoidance by private equity and hedge funds N/A Announcement: 08/07/2015 Employers social contributions Self-employed: abolition of Class 2 NICs Phase-out (decrease) Announcement: 16/03/2016 Administrative, compliance related measures Tax motivated incorporation: reduction due to dividend tax reform Rate increase Announcement: 08/07/2015 Controlled foreign companies: loss restriction N/A Announcement: 08/07/2015 Large business: enhanced compliance N/A Announcement: 08/07/2015 Specialist personal tax: enhanced compliance N/A Announcement: 08/07/2015 Wealthy: enhanced compliance N/A Announcement: 08/07/2015 Hidden economy N/A Announcement: 08/07/2015 Local compliance N/A Announcement: 08/07/2015 Source: DG Taxation and Customs Union. DG Taxation and Customs Union Taxation trends in the European Union 189

5 2 National tax systems: Structure and recent developments Main features of the tax system Table UK.3: Individual taxation (PIT) General Base and jurisdiction Taxation of couples and families Resident: worldwide income (subject to double-tax relief)) n-resident: domestic income Separate taxation System and Applicable rates ( 1 ) Global / Labour income scheme Basic personal allowance GBP Basic allowance Marriage and married couple s allowances, dependent on income/age; child tax credits, working (low-income) tax credits Progressive 3 brackets 20%, 40%, 45% Rate schedule Top rate 45% (above GBP ) Surtaxes Regional and local surcharges Top statutory PIT rate (including surcharges) 45% Owner occupied dwelling Capital income Income from renting movable property Income from renting immovable property 10% on net gains where below income tax basic rate threshold; 20% Capital gains (immovable property) thereafter Capital gains (movable property) As above Allowance of GBP on which no tax on dividends is charged. Dividends Dividends above this amount taxed on a progressive scale: 7.5%, 32.5%, 38.1% Personal Savings Allowance of GBP for basic rate taxpayers, GBP Interests on deposits and special savings accounts 500 for higher rate tax payers and zero for additional rate tax payers. Above these amounts, rates are progressive. Interests on corporate and government bonds Other specific features and alternative regimes Other tax provisions Main tax credits & deductions Professional expenses Based on real expenses Pension savings Mortgage Child care, educational, medical and travel expenses, alimony, donations, Others (not exhaustive) union fees, loan interest Treatment of losses (business/self-employed income) Indefinite carry forward; 3 year carry backwards ( 1 ) For financial year Taxation trends in the European Union DG Taxation and Customs Union

6 National tax systems: Structure and recent developments 2 Table UK.4: VAT Tax rates Standard 20% Reduced rate(s) 5% Table UK.5: Corporate Taxation (CIT) Tax rates ( 1 ) minal corporate income tax rate 20% Central government surcharge Regional government surcharge Local government surcharge Top statutory CIT rate (including surcharges) 20% Special tax rate for SMEs (all-in rate) Tax base Worldwide income Anti-avoidance (thin cap rules incorporated within transfer pricing rules; apply arm s length principle; Worldwide Debt Cap restricts the deduction for financing Limits to interest deductions expenses of large groups based on gross financing expenses of the worldwide group) Transfer pricing rules, arm s length principle Controlled foreign company (CFC) Controlled foreign company (CFC) for passive income only Allowance for Corporate Equity ( 1 ) For financial year Table UK.6: Social contributions Employment income, Income from business or self-employed activities, Base Benefits in kind Employers contributions ( 1 ) Total rate 13.8% (for annual earnings over GBP 8 112) of which: Capped contributions Employees contributions ( 1 ) Total rate 12% (for annual earnings up to GBP , 2% thereafter) of which: Capped contributions ( 1 ) For financial year ( 1 ) Employees contributions are matched by a tax reduction of the same amount. Table UK.7: Wealth and transaction taxes Inheritance and gift tax Real estate taxation Recurrent real estate tax Regional differentiation Tax discount for primary dwelling Real estate transfer tax Net wealth tax - some discount for second or holiday homes Source: DG Taxation and Customs Union, on the basis of information provided by the national finance ministries. For more detail the TEDB database contains an extensive inventory of the main taxes in force in EU Member States. DG Taxation and Customs Union Taxation trends in the European Union 191