The Telegraph: Firms rush to relocate in low-tax Britain
By Kamal Ahmed & James Quinn
Steve Varley, the UK chairman of Ernst & Young, revealed that the accountancy firm knew of the significant number of firms seeking to relocate from countries such as the USA, as well as from the Netherlands, Switzerland and Ireland.
The high figure will be a boost to George Osborne, the Chancellor, who has made Britain’s lower rates of corporation tax a centrepiece of Government policy. The advertising giant, WPP, recently announced that it would move back to the UK from its present headquarters in Dublin.
“I know of more than 40 multinational companies that have been looking to undertake global and regional headquarter relocations into Britain,” Mr Varley said.
“They have the potential to bring £1bn of additional annual tax revenues and more than 2,000 high-value senior management jobs to the country.
“There are numerous reasons for this, including real progress on the British ambition to become one of the most competitive corporate tax regimes in the G20.”
Mr Varley also revealed new figures which suggest that many foreign businesses from north America and Asia believe Prime Minister David Cameron’s push to renegotiate Britain’s legal agreements with the European Union would be attractive to many businesses.
“What I’m hearing in the market is that renegotiating our relationship with the EU would actually have little negative impact on foreign investment decisions into the UK,” he said.
“In an Ernst & Young survey of 300 investors from around the world, we asked their reaction to Britain moving to a renegotiated and looser relationship with the EU.
“The difference in investor attitudes across the world was really quite surprising. Only 36pc of investors from Western Europe said reduced integration with the EU would make the UK more attractive as an FDI [foreign direct investment] location.
“However, both north American and Asian investors were much more positive about the opportunity.
“Some 72pc of US and 66pc of Asian investors said that a renegotiated relationship would actually improve the attractiveness of Britain as an FDI location.
Mr Varley’s comments come ahead of this week’s major Global Investment Conference (GIC), due to be held in London on Thursday.
The conference, now an annual event, will be held at a central London hotel ahead of the crucial G7 finance ministers’ and central bank governors’ meeting in Northern Ireland, scheduled for Friday and Saturday. Business leaders, including Tidjane Thiam, the chief executive of insurer Prudential, and Greg Case, chief executive of Aon, are due to attend.
The Prime Minister, as well as the Energy Secretary, Edward Davey, and the Treasury minister and former Olympics chief, Lord Deighton, are also expected to play a part in the day-long programme to promote the UK as a place to do business.
Christine Lagarde, head of the International Monetary Fund, and Jim Flaherty, Canadian finance minister, are also due to appear.
Lord Green, the trade and investment minister, said the Government was committed to attracting more inward investment into the UK as it fought to find new growth opportunities.
“Over the coming years, we aim to attract hundreds of billions of pounds in infrastructure investment, delivering major projects in partnership with companies and investors within the UK and overseas,” he said.
The event follows on from last summer’s conference, held on the eve of the Olympic Games, which was considered a success.
The GIC event was last year supported by the British Business Embassy series of events at Lancaster House in London.