After a group of bosses from some of Britain’s biggest companies confronted Prime Minister Gordon Brown and Chancellor Alistair Darling at 10 Downing Street, HM Treasury may want to take another look at its rules on tax paid by multinationals in the UK on dividends from their overseas operations.
The group, which included HSBC’s Stephen Green; Vodafone’s Arun Sarin; and Glaxo Smith Kline’s Andrew Witty, representing the influencial Multinational Chairmen’s Group, warned Brown and Darling, if this went ahead, they would vote with their feet, according to The Times.
The group’s message for Brown and Darling was that Britain was at risk of a mass corporate exodus. Treasury proposals to change the treatment of foreign earnings had hardened the companies to general unrest about corporate tax.
Brown and Darling appeared surprised by the reaction to their tax proposals, a senior tax laywer familiar with the meeting revealed. The strength of feeling on the issue was apparently expressed most forcefully by Vodafone’s Sarin. ‘They were only just waking up to what it really meant,’ the lawyer said.
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