Tax rates and thresholds

It is known that the rate of CT for small companies will not increase from 21% to 22% in 2009 (as had been announced in 2007).  This is to ease the burden of taxation on business and combat the effects of the recession.
It is even possible that this will be reduced to 20% and the standard rate reduced from 28% to 25% in order to make the UK a little more competitive.

One of the reasons for progressively increasing the small companies’ rate was to address the advantage offered for businesses to operate as companies and for profits to be extracted tax efficiently. This may be reason enough for not reducing the small companies’ rate.