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FTSE100 Tax Burden Grows

Thursday, March 4, 2010

The UK total amount of tax collected by the UK's largest listed companies on behalf of the country's government has grown significantly as a proportion of total corporate earnings since 2007, a new survey has found.

The survey, conducted by PricewaterhouseCoopers for The Hundred Group of FTSE 100 Finance Directors, found that, despite the depressed economic environment, the total tax rate for FTSE100 firms - the 100 largest firms listed on the London Stock Exchange - increased from an average of 38.2% of total earnings in 2008 to 41.6% in 2009. This represents a year-on-year increase of 9% in FTSE 100 companies’ average total tax rate.

The UK’s largest companies paid or collected GBP66.6bn (USD100bn) in taxes during the 2008/2009 tax year, the survey found. While corporation tax payments fell 6.4% to GBP10.3bn over the period, other taxes did not reduce in line with declining profitability and therefore account for a higher proportion of overall earnings.

Taxes on employment represent a significant and growing proportion of the total tax burden: The Hundred Group FTSE 100 companies now pay employment taxes to the UK Exchequer which equate to an average of GBP17,721 per employee.

Ashley Almanza, chairman of The Hundred Group of Finance Directors, said: “FTSE 100 businesses play an integral role in the UK economy, providing employment to 1.7 million people – many of them in highly skilled roles – and generating almost 13% of the government’s total tax receipts.”

While Treasury minister Stephen Timms claimed in a recent speech that the UK's corporate tax rate, at 28%, is the "most competitive corporation tax rate of the major economies," the results of the survey are likely to merely confirm fears in the world of enterprise that the UK is becoming an increasingly uncompetitive place in which to do business.

“The Hundred Group survey reveals that total UK tax contributions are absorbing an increasing proportion of the value generated by FTSE 100 companies," Almanza continued.

"This presents a growing challenge for the UK’s largest firms. To be competitive, companies need to ensure that their capital and investment in people, skills and innovation are targeted at countries whose business environments and tax systems are internationally competitive,” he concluded.

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The Report

Offshore Trusts Guide: Introduction

The History of Offshore Trusts
Development of Professional Competence in the Jurisdictions
What Future for the Trust?
The New Age of Transparency
The Swiss Association of Trust Companies
The Society of Trusts and Estates Practitioners

Offshore Trusts Guide: Jurisdictions

Bahamas

Bahamas: Legal Framework and Formation Rules and Fees
Bahamas: 2006 Private Trust Companies Legislation

Barbados

Barbados: Legal Framework and Formation Rules and Fees
Barbados: Supervisory and Licensing Regime and Fees

Bermuda

Bermuda: Legal Framework and Formation Rules and Fees
Bermuda: Supervisory and Licensing Regime and Fees

British Virgin Islands

British Virgin Islands: Legal Framework and Formation Rules and Fees
British Virgin Islands: Special Trusts Act 2003
British Virgin Islands: The Trustee Act 2003
British Virgin Islands: :Supervisory and Licensing Regime and Fees
British Virgin Islands: New Laws on Private Trust Companies
British Virgin Islands: New Private Trust Company Regulations

Cayman Islands

Cayman Islands: Legal Framework and Formation Rules and Fees
Cayman Islands: Supervisory and Licensing Regime and Fees

Cook Islands

Cook Islands: Legal Framework and Formation Rules and Fees
Cook Islands: Supervisory and Licensing Regime and Fees

Cyprus

Cyprus: Legal Framework and Formation Rules and Fees
Cyprus: Supervision, Licensing and Tax

Gibraltar

Gibraltar: Legal Framework and Formation Rules and Fees
Gibraltar: Legislation, Regulation and Supervision

Guernsey

Guernsey: Legal Framework and Formation Rules and Fees
Guernsey: Trusts Law 2007

Isle of Man

Isle of Man: Legal Framework and Formation Rules and Fees
Isle of Man: Supervisory and Licensing Regime
Isle of Man: Uses Clients and Tax Treatment

Jersey

Jersey: Legal Framework and Formation Rules and Fees
Jersey: Supervisory and Licensing Regime
Jersey: Trusts Amendment Act 2006
Jersey: Foundations

Liechtenstein

Liechtenstein: Legal Framework and Formation Rules and Fees
Liechtenstein: Regulation Supervision and Transparency
Liechtenstein: Characteristics of Liechtenstein Trusts
Liechtenstein: Foundations

Madeira

Madeira: Legal Framework and Formation Rules and Fees

Malta

Malta: Legal Framework and Formation Rules and Fees
Malta: The Trust and Trustees Act 2004

Mauritius

Mauritius: Legal Framework and Formation Rules and Fees
Mauritius: Characteristics of the 2001 Trusts Act
Mauritius: Additional Provisions of the 2001 Trusts Act
Mauritius: Tax Treatment

Monaco

Monaco: Legal Framework and Formation Rules and Fees

Nevis

Nevis: Legal Framework and Formation Rules and Fees

Panama

Panama: Legal Framework and Formation Rules and Fees
Panama: Requirements for Acting as Trust Company in Panama

Seychelles

Seychelles: Legal Framework and Formation Rules and Fees

Turks & Caicos

Turks & Caicos: Legal Framework and Formation Rules and Fees
Turks & Caicos: The Voidable Dispositions Ordinance

Vanuatu

Vanuatu Legal Framework and Formation Rules and Fees




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