HMRC's estimate · edition published 24 Jun 2025
What 1 point on corporation tax raises
Corporation tax is paid on company profits. The main rate is 25% now; this is what raising it to 26% would raise.
HMRC's caveat. HMRC raises the main rate and the small profits rate together, and leaves out North Sea oil and gas, the Energy Profits Levy and the bank surcharge.
HMRC costs a rise only.
Quote this
HMRC estimates that 1 point on corporation tax (25% to 26%) would raise £3.6bn in 2026-27 and £4bn in 2028-29. Source: HMRC, Direct effects of illustrative tax changes, edition published 24 Jun 2025. https://ledgergov.uk/tax/corporation-tax
Where this comes from
From HMRC's Direct effects of illustrative tax changes, the edition published 24 Jun 2025, the latest (on file as HMRC-DE-2025-06). HMRC's row: “Increase Corporation tax by 1 percentage point”.
HMRC works out each figure for a change made at the start of 2026-27, on its own, on the official forecast of the time, and shows each year to 2028-29. It includes how taxpayers respond, where HMRC models it, but no wider effects on the economy. HMRC publishes one figure a year; we show a range of 10% either side of it, our usual band where a source gives none.
See how the numbers are made, or the Autumn Budget 2026 page.