Company taxation and innovation policy.

Book section

This chapter begins with a discussion of four issues in company taxation. First, we assess the recent government consultation document on reform to corporation tax, which looks at possible changes to the rules for calculating taxable income. (This follows a series of reforms to the taxation of corporate profits since 1997, which are discussed in Chapter 9.) In Section 6.2, we look at the taxation of dividends, in the light of the changes to the UK tax system since 1997 and recent proposals for reform in the USA. In Section 6.3, we assess the structure of North Sea taxation following the changes announced in Budget 2002 and in the 2002 Pre-Budget Report. Then, in Section 6.4, we consider an issue that is not on the government’s immediate agenda, but one where there might be a case for reform – stamp duty on share transactions. The chapter also looks at innovation policy, following the 2002 Pre-Budget Report announcement of a review into the interaction between universities and business, which will report at the same time as a separate review of the UK’s innovation performance. In the final section of the chapter, we examine trends in UK research and development (R&D;) activity and consider current policy towards innovation, including the two new R&D; tax credits.

Authors: Bond, S; Harrison, R; Hawkins, M; Klemm, A; Simpson, H

• Publisher: IFS
• Host title: The IFS Green Budget: January 2003
• Pages: 64 - 84
• Place of publication: London
• Publication date: 2003-01-01
• DOI: 10.1920/co.ifs.2003.0092
• ISBN: 978-1-903274-29-3
• Language: English