Question to the HM Treasury:

To ask the Chancellor of the Exchequer, what estimate he has made, applying the Laffer curve, of the potential effect on tax revenues of a reduction in corporation tax.

The fiscal and economic impact of changes in the rate of Corporation Tax (CT) have been set out in the Office for Budget Responsibility’s (OBR’s) Economic and Fiscal Outlooks which are published alongside fiscal events.

The most recent forecast, published in March 2021, includes the revenue raised from the announcement made at Budget 2021: that the main rate will increase to 25% from April 2023, which is forecast to raise over £45 billion across the next 5 years.

This forecast incorporates adjustments to reflect behavioural responses from businesses to changes in the rate of CT.