Brexit Secretary Dominic Raab Warns Brussels That UK Will Slash Corporation Tax In A ‘No Deal’ EU Exit

Tory ministers could hand corporate giants a massive tax cut in a No Deal Brexit , a top Cabinet figure revealed tonight.

Dominic Raab said the government will “pull every lever we’ve got” to ease business “disruption” if the UK leaves the EU with no agreement in March 2019.

The Brexit Secretary even left open a radical idea of slashing corporation tax from 19% to 10% – which would firms a huge tax break while millions of working families struggle.

He spoke on the fringes of the Tory conference hours after Chancellor Philip Hammond said he was reserving “fiscal firepower” to “support the economy” in No Deal Brexit.

Brexit Secretary Dominic Raab Warns Brussels That UK Will Slash Corporation Tax In A ‘No Deal’ EU Exit

Setting a rate of 10 per cent would cost the Treasury tens of billions, but ministers would gamble on recouping that over time, by having one of the lowest tax rates for business in the world.

Before the Tories lost the 2017 general election, Mr Hammond himself talked of lowering taxes as a way to cope without a Brexit deal.

He said: “If Britain were to leave the European Union without an agreement on market access, we could be forced to change our economic model….to regain competitiveness.”

The threat sparked Labour claims that the Conservatives planned to turn the UK into a low-tax, low-regulation ‘Singapore-on-Thames’, in a desperate bid to undercut the EU.

However, Mr Hammond has since backed off such suggestions, as he instead issued increasingly stark warnings about the cost of crashing out of the EU.

Meanwhile, speaking at a separate event, home secretary Sajid Javid called for tax cuts if the UK left the EU with no deal and did not have to pay the so-called Brexit “divorce bill” of at least £40bn.

“In terms of the £40bn, there is tendency in government if you get some sort of windfall back in cash to your department or elsewhere to start wondering ‘how do I spend it’.

“The default position should be ‘I should give this back to the people’, because it’s their cash in the first place. That’s exactly what I would do. We are taxed enough as it is – give it back to the people.”

However, half of the £40bn consists of legal commitments Britain would be expected to pay even without a Brexit deal – while economists agree the cost of crashing out would far outweigh the remaining savings.

Read More : Brexit putting Tory reputation for economic competence at risk, warns Grieve

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