LONDON • British Prime Minister Boris Johnson said yesterday he was putting on hold further cuts in corporation tax and told voters he would pump the money into services such as health instead, addressing a central issue in the Dec 12 election.
"We are postponing further cuts in corporation tax," Mr Johnson told business leaders at a conference organised by Britain's main business lobby, the Confederation of British Industry (CBI).
"This saves £6 billion (S$10.6 billion) that we can put into the priorities of the British people, including the NHS (National Health Service)," he said.
Britain had been due to cut its corporation tax rate to 17 per cent next year, down from 19 per cent now, which is already one of the lowest among the world's big industrialised economies.
Mr Johnson has faced questions about how he would pay for the extra public spending that he has promised, without ramping up borrowing sharply.
In September, his finance minister Sajid Javid announced the biggest increase in day-to-day spending in 15 years in what was widely seen as an attempt to counter the spending promises of the left-wing opposition Labour Party.
Mr Johnson's announcement received a cautious welcome from Ms Carolyn Fairbairn, head of CBI.
She said in a statement: "Postponing further cuts to corporation tax to invest in public services could work for the country if it is backed by further efforts to (address) the costs of doing business and promote growth."
Mr Johnson said the UK economy "is still not achieving what it should" and had "so much more natural energy waiting to be unleashed".
He said his Brexit deal "gives business complete stability and certainty as we come out in January".
He also added a new line to his repertoire about leaving the European Union, saying it would make people feel better: "It's time for us to get Brexit done because it's the best thing for our national mood."
The opposition Labour party, on the other hand, has promised tax hikes for both business and the wealthy.
Last Friday, the party shocked industry by announcing that if it won the Dec 12 election, it would take the UK's broadband infrastructure into public ownership.
Labour leader Jeremy Corbyn said his party is not anti-business. Speaking to the CBI conference, he said he would not apologise for wanting to raise taxes on the richest and for planning to take key businesses into public ownership.
A Survation poll for yesterday's Good Morning Britain TV show put Mr Johnson's Conservatives on 42 per cent, Labour on 28 per cent, the Liberal Democrats on 13 per cent and the Brexit Party on 5 per cent.
Meanwhile, Mr Johnson confirmed that Mr Javid will keep his job as Chancellor of the Exchequer if the Conservatives win the election.
"I will keep Sajid Javid as my Chancellor," the Prime Minister told the CBI conference. "I think he's a great guy, he's doing a fantastic job and I'm proud to have him as a colleague."
REUTERS, BLOOMBERG
