The ongoing standoff between the European Union and the United Kingdom continues today. In fact, the negotiations surrounding the release of England from the EU are still very tense. The British even intend on halving corporate income taxes in order to better address the position assumed by European leaders.
The Reduction on Corporate Income Taxes, as Organized by the United Kingdom
The ominous risk that London significantly reduces income taxes is gaining more and more ground. Faced with a refusal from the European Union in accepting a trade agreement, Great Britain further intends on taking initiatives to both encourage and push companies to stay. In the British newspaper titled The Times, someone with a close relation to the government states that the United Kingdom “have their own deal of cards to play” if the EU should chooses to impose any tariff barriers. In this same regard, this anonymous individual further stressed that their country was fully capable of reducing at least 10% of corporate income taxes.
The British daily newspaper also adds that a covert plan would currently be under way. This plan is said to involve a 20% reduction on income taxes instead. Needless to say, if these numbers were the case, than such a reduction would result in enormous savings for all companies based in the United Kingdom. This project is currently being examined and would aim towards countering the harsh discussions regarding the release of London. With such a position, the British seek to create an incentive for the European companies that are established on the British Islands, attempting to encourage them to stay by maximizing their taxation system. For their own behalf, the European Union continues providing comebacks. Moreover, since the Brexit vote, many European governments have hardened their stance regarding London. The companies registered within the United Kingdom that are involved within the said countries economy by up to 10% are at risk of being denied access to financial services, by the organization.
Tense Negotiations Between the European Union and the United Kingdom
Release negotiations are currently being carried out within a very tense atmosphere. Prior to a specific meeting of the EU members, the French President reiterated his intention on adopting a straight line of conduct and further precised firmly telling the British Prime Minister, Theresa May, who strives for a tough Brexit that the negotiations shall be just as tough. These remarks only came to light after the Prime Minister disclosed his willingness to initiate Article 50 of the Lisbon Treaty before the end of March 2016. This will then be the first phase in giving back full sovereignty and independence to the United Kingdom. Which will also conclude the Union’s authority over this country.
However, what was observed through the Brexit vote is that several positive points were noted regarding the British economy. Effectively, the decline in pounds boosted tourism overall and helped increase exports. The Brexit also led to the decrease in cost of rent in London. In addition, the United Kingdom can actually be seen as an attraction to many companies by reason of its tax havens, among which can be cited the Isle of Man – home to a vast amount of companies. The latter made the decision to flee all countries within the eurozone that have harsh taxation laws.