The political pattern is pretty well set: reduce the rate of corporation tax to plump up the UK as a centre of international business, while raising tax takes and levies elsewhere.
The chancellor used the 2016 Budget to announce the corporation tax level would be reduced to 17 per cent by 2020, compared with 28 per cent at the start of the previous parliament. "Let the rest of the world catch up," Mr Osborne told the House of Commons, a stance subsequently cheered on by the CBI.
Giving with one hand, with the other he restricted the tax deductibility available on corporate profits.
Firstly, large companies will now only be able to deduct debt interest from 30 per cent of their UK earnings, although some industries that depend more on borrowing will be subject to a 'group ratio rule'. The desire here is to stop international companies offsetting UK profits by borrowing here to spend abroad, and to raise a cool £4bn by 2020-21.
Secondly, the government will follow other developed economies by restricting the amount of profits that can be offset by past losses to 50 per cent, and 25 per cent for banks. This will only apply to company profits in excess of £5m, but will still raise £3.4bn by the end of the Parliament.
This time the CBI was not so happy, commenting: "Changes to the tax treatment of losses will make it harder for larger scale-up firms and companies that have been through tough times to play their part in the recovery."
But at the same time the government is making these carry-forward rules more flexible, so losses in one area can be set against profits elsewhere in a group. This should help more than 70,000 domestic companies, according to official figures.
All in all, the small business has retained its potency as a political symbol. Business rates will be cut across all commercial properties in England, with 600,000 small firms paying no rates at all. As predicted, larger companies will be helping fill the budgetary hole.
