FTSE 100 tax contribution hits £90bn amid warnings against further hikes
The total tax contribution from the UK’s largest firms surpassed £90bn for the first time amid warnings about the potential consequences of the latest tax hikes on business.
PwC estimated that firms in the 100 Group contributed a total of £93.3bn to the Exchequer in the 2023/24 financial year, amounting to just under 10 per cent of government revenue.
This was up from £89.8bn last year, reflecting the increase in corporation tax which came into effect last April.
Andy Agg, chair of the 100 Group’s tax committee, said the survey showed the “significant contribution that large companies make to the public finances as well as to the wider economy”.
Andrew Griffith, shadow business secretary, said the survey confirmed that “private businesses create the wealth to pay for an ever increasing public sector cost”.
“No one’s pockets can be picked infinitely if we wish to have a globally competitive economy,” he told City PM.
The report comes just weeks after the government announced major tax hikes on businesses in the Budget.
Rachel Reeves increased the amount employers have to pay in NICs by 1.2 per cent, and lowered the wage threshold at which employers must start paying the tax from £9,100 to £5,000.
PwC said this tax increase was likely to be “the most significant change” this year and will be reflected in the firm’s 2026 survey.
A recent survey from the Confederation of British Industry (CBI) showed that two-thirds of 185 companies think the Budget will damage UK investment.
“In the budget, business has been the cash cow and it’s been milked,” Rupert Soames, chair of the CBI said at the body’s annual conference. “Don’t go and whack it,” he warned.
The 100 Group represents the views of the finance directors of FTSE 100 and other large UK private companies.
The £93.3bn figure for total tax take includes £31.8bn borne directly by the firms themselves, through levies such as corporation tax and employers’ national insurance. This was up 10 per cent compared to last year.
The remaining £61.5bn of the tax take came primarily from employment taxes, like income tax and employees’ national insurance.
The survey showed that firms in the 100 Group employed around 1.8m people in 2023/24, 5.4 per cent of the total UK workforce.
A Treasury spokesperson said: “With our public services crumbling and an inherited £22bn fiscal black hole, we had to make difficult choices to fix the foundations of the country and restore desperately needed economic stability.
“This was a once in a Parliament budget to wipe the slate clean. We’ve done that now, have capped corporate tax at 25 per cent and have confirmed full permanent expensing. Working together with business we’re determined to unlock the growth opportunities of our country for the future.”