What is Corporate Taxation Assignment Example | Topics and Well Written Essays - 2250 words

What is Corporate Taxation - Assignment Example To fund Napoleonic Wars, William Pitt The Younger incorporated the simple process of taxation in Britain in the budget of 1798. And hence the tradition carries on. History of Corporate Tax: In the Finance Act of 1965, the process of uniform taxation for individuals and corporates was abolished and separate Corporate Taxation was started. It is currently governed by the Income and Corporation Taxes Act 1988, which has also undergone amendment. Advance Corporation Tax (ACT) and its abolition: The advance Corporation Act introduced in 1976 came as a blow to corporates as dividends paid by the corporates were highly and disproportionately taxed. 0n 6 the April 1999, it was abolished by Mr. Gordon Brown, the then vice chancellor of the Exchequer, who is none other than the Prime Minister of Great Britain today. Reduction of Rates by Gordon Brown In 1999: In the budget of 1999 Gordon Brown introduced a more efficient and proportionate taxing system or rate according to the volume of profits, as in opposition to an age-old system of 1965. A budget of 2002: It scrapped the tax on companies earning profits up to 10000 pounds and that witnessed a huge growth in the number of self-employed and small-scale industries. It is still perceived to be a major step in the UK's Corporate Taxation history. (Darmon, 2008) Adoption of Ethical and more scientific Appraisal standards: IFRSs or International Financial Reporting Standards was adopted by European Union in 2005 and hence as well as the UK to promote transparency in taxation system and hence benefited the corporates in general. (Nardi, 2005)Â   Finance Act of 2004: The first of its kind, it promoted the use of legal anti Tax Avoidance Schemes among Corporates. (Public Sector Information, 2004) Finance Act of 2005: For the need of higher revenues, Oil, Gas & Life Insurance companies were targeted in this budget and laws were implemented forcing them to pay lump sum tax installments and that cost these companies heavily. (Public Sector Information, 2005)