The CBI has backed the government’s decision to set up a working group to look at the competitiveness of the UK’s corporate tax system.

The government’s announcement yesterday follows hard on the heels of the high-profile departure of two UK multi-nationals – Shire Pharmaceuticals and United Business Media - to Ireland for tax residency purposes.

CBI director general, Richard Lambert said: ‘The CBI looks forward to working as part of the new group to identify a clear, internationally competitive corporate tax strategy for the UK.’

The employers’ body released a taskforce report last month revealing failure of the UK tax system to respond to increasingly global business activity which was creating an unsustainable regime.