Jeremy Corbyn accuses Theresa May of 'chasing Donald Trump to the bottom' on corporation tax cut

Posted On: 
21st November 2016

Jeremy Corbyn today accused Theresa May of trying to “chase” Donald Trump in a “race to the bottom” after she promised Britain would offer the lowest corporation tax in the G20.

Labour leader Jeremy Corbyn addressed the CBI conference for the first time today
Credit: 
PA Images

The Labour leader branded the pledge “reckless, short-term grandstanding” as he addressed the UK’s biggest business lobby - the Confederation of British Industry - for the first time at its annual conference.

He also called on the Government to “raise its game” on Brexit, accusing the Prime Minister of “fuelling economic uncertainty” with her approach to date.

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Addressing the same conference this morning, Mrs May suggested she will drop Britain’s corporation tax rate lower than the planned 17% by 2020.

“My aim is not simply for the UK to have the lowest corporate tax rate in the G20, but also one that is profoundly pro-innovation,” she said.

New US president-elect Donald Trump has said he wants to cut his nation’s corporation tax rate to 15% - which would suggest Mrs May is set to follow his lead if not go lower.

But Mr Corbyn fumed: “The Prime Minister’s suggestion that Britain should chase after Donald Trump, in a race to the bottom in corporation tax, to 15% or below, is reckless, short-term grandstanding.”

Elsewhere, he hit out at the Government’s Brexit strategy amid ongoing criticism that Mrs May’s refusal to outline her EU negotiation plans is adding to business uncertainty.

“Now more than ever, we need government comprehensively to raise its game on the challenge of Brexit,” he told the conference hall in London.

“Its shambolic handling to date has fuelled economic uncertainty and is hampering business planning.”

He added: “Bad [government] intervention wants to punish you with a shambolic Brexit that limits our ability to trade with the world’s largest trading bloc on our doorstep.”

His comments echo those of CBI president Paul Drechsler, who today called on the Government to offer “clarity and, above all, a plan" so firms can be sure of their investments. 

'NEW SETTLEMENT'

Mr Corbyn also offered a “new settlement” for business, with a slight rise in corporation tax in return for major economic investment, greater research spending and a so-called ‘National Education Service’. 

“Labour will be on the side of the innovators, entrepreneurs and investors that our economy and our workforce need,” he said.

“We will use public intervention to unleash the creativity and potential of entrepreneurial Britain.

“Labour is open. We’re open to change. Open to new ideas. And open to working with you.

“In return, we ask you to be open, to listening to the workforce, in the boardroom as well as the shopfloor.”

But the CBI took issue with his criticism of controversial zero-hours contracts and calls to adopt the Living Wage.

Caroline Fairbairn, the CBI director general, said after Mr Corbyn's address: “Fair wages are a vital part of a fair and prosperous society, and the independent Low Pay Commission is well positioned to ensure future rises do not come at the expense of people’s jobs.

"The vast majority of businesses are committed to eliminating poor practices, though this should not be confused with certain types of contracts which allow the flexibility many workers value.”