Private NHS providers in line for corporation tax exemption

[Northerner]

Private companies providing NHS services could be exempt from paying corporation tax on their profits under proposals being considered by a government-commissioned review of competition in the health service, the Guardian has learned.

Monitor, the NHS's economic regulator, argues that as public sector hospitals do not pay corporation tax and VAT on supplies, whereas private firms do, the result is an "unfair playing field" in healthcare. The regulator was asked to look at the issues as part of a review into NHS competition, and will report to the health secretary, Jeremy Hunt, later this month.

Hunt's predecessor, Andrew Lansley, produced analysis which said "the majority of the quantifiable distortions work in favour of NHS organisations; tax, capital and pensions distortions result in a private sector acute provider facing costs about ?14 higher for every ?100 of cost relative to an NHS acute provide".

http://www.guardian.co.uk/society/2013/jan/13/private-firms-corporation-tax-nhs-profits

 

[Northerner]

Update: NHS regulator rules out tax exemptions for private health firms

The economic regulator of the health service has ruled out tax exemptions for private firms that deliver NHS services.

Reports this week had suggested Monitor was to propose that commercial providers should not have to pay corporation tax, in order to ensure fair competition for health service contracts between private firms and NHS hospitals.

But the regulator said on Tuesday recommendations on tax exemption would not be part of a government-commissioned review of NHS competition expected to be completed by the end of March.

http://www.guardian.co.uk/society/2013/jan/15/nhs-regulator-tax-exemptions-health