Tax hike 'a poke in the eye' after RPI data

Date: 25th March 2009

Hiking corporation tax is no longer justifiable following the UK's fall in inflation, it has been claimed.

Commenting on the latest retail price index (RPI) data, which showed inflation had fallen to zero, the Confederation of British Industry (CBI) slammed the government's proposed five per cent corporation tax rise.

According to the CBI, the Treasury cannot justify raising taxation based on last September's RPI figures, which showed a significantly higher level of inflation.

Dr Neil Bentley, director of business environment, commented: "A spike in inflation half a year ago should not be allowed to poke business in the eye now, at the worst possible time.

"The government should freeze business rates for two years, helping companies to survive the recession and saving jobs."

Recent figures published by the financial comparison site uSwitchforBusiness.com revealed that three quarters of small firms were confident of beating the recession.