Nigel Farage gets tax numbers wrong
At the Brexit Party’s manifesto launch this morning, leader Nigel Farage pledged to remove corporation tax on business profits under £10,000.
Justifying the proposal, Mr Farage said in the Telegraph this morning that: “two-thirds of British businesses do not make a profit over £10,000 every year but are nonetheless subjected to corporation tax.”
He made a similar claim in his speech this morning, that a million companies do not make a profit of over £10,000 a year.
This is incorrect.
Mr Farage seems to have confused the number of limited businesses who have to pay up to £10,000 of corporation tax (one million in 2017/18) with the number of businesses which make profits of up to £10,000 (and therefore would only be liable to pay corporation tax up to £1,900, on the 19% rate).
The Brexit Party correctly stated this statistic in their manifesto: “one million companies - some 66% of the total number - pay less than £10,000.”
It’s not clear that the party’s pledge is to stop all those companies paying corporation tax altogether, though. The party’s pledge seems to be that corporation tax would be waived for the first £10,000 of pre-tax profits, not the first £10,000 of tax owed.
We’ve asked the Brexit Party to clarify.