Tax Webinar: what happens after Brexit?
Watch our tax webinar as our experts discuss the latest updates and insights in relation to the end of the Brexit transitional period.
UK tax cuts expected
The UK financial sector last year paid £ 75.6bn ($ 104.08bn) in taxes, but similar revenues are projected to drop markedly in 2021 as unlimited access to EU resources ends and the pandemic continues to rage on the territory of Foggy Albion.
City of London said its tax contribution until March 2020 remained largely unchanged from the previous period, despite uncertainty over the future of UK-EU relations.
«It is difficult to count on the usual amount of tax deductions due to the fact that the future is still in the fog. We still cannot determine the long-term consequences of the pandemic, Brexit and the massive shift to remote work», – said Katherine McGuinness from City of London.
Revenues are expected to decline in the current fiscal year, which ends in March, sagging from £ 75.7bn to £ 71.1bn, PwC consultants calculated in their report..
«Moving to new UK-EU trade agreements will put further pressure on financial services recovery», – says the report.
UK trade deal with the eurozone from January 1 does not extend to financial services, and London is likely to gain limited access to the EU for the foreseeable future.
The export of financial services to the EU in recent years amounted to about 26 billion pounds sterling annually, but part of this segment has already moved to the EU countries, not wanting to lose access to the European market.