Tax Contribution from Financial Services Sector Down in 2010 from 2009 – PwC
An extrapolated figure from Pricewaterhouse Coopers’s analysis of the tax contribution from the financial services industry for the year ended March 2010 showed a 12.1 percent decline to 53.4 billion pounds from 61.4 billion pounds in 2009.
The analysis, which is commissioned by the City of London Corporation, covered employment and business taxes from across 30 companies in the sector, with an average financial services pay of 71,236 pounds that generated 40,481 pounds of taxes in the same period that the analysis covered.
The report said tax contribution from the profits of financial institutions in the last fiscal year yielded 5.6 billion pounds for the government, 26 percent down from 7.6 billion a year earlier than that. Another 24.5 billion pounds of tax contribution from the sector was recorded following an employment of more than one million people in March, which included income tax and National Insurance Contributions from employees and employers alike.
City of London Corporation’s policy chairman Stuart Fraser recognized the tax contribution from the financial services industry despite a lower record compared to last year, which he attributed to the economic crisis that affected firms across London.
He warned the government that raising taxes on the financial services sector might jeopardize the current status of tax contribution, with the possibility of driving out firms in the UK and missing the chance of winning investors to do business in the country.
UK Prime Minister David Cameron assured that his coalition government has become vigilant with “crossing the threshold” in imposing taxes on the sector, to sustain the tax contribution already felt by the UK government amidst the uncertain economic environment that drove down tax receipts and brought about deficits in budget.