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Tax policy can help deliver net zero emissions

10 May 2024
Issue: 4936 / Categories: News

The UK should use tax incentives to outsmart rather than outspend international competition in high-growth green sectors according to research from the Confederation of British Industry (CBI).

The country has committed to decarbonise by 2050 but risks falling behind global competition finds the report Tax and Green Investment. It notes that the US and Europe have introduced reform packages - US Inflation Reduction Act and the EU Net Zero Industry Act - to incentivise green investment using tax credits subsidies grants and loans.

The CBI makes several recommendations to target important green technologies. These include a new green innovation credit a lower corporation tax rate for profits derived from green technologies and an enhanced green super-deduction rate of at least 120% to encourage capital investment.

Rain Newton-Smith CBI chief executive said: ‘Making better use of the tax system in...

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