The Confederation of British Industry has raised concerns about the UK's anti-competitive tax regime after Shire announced it would relocate to Ireland where tax rules are more favourable for business.

Richard Lambert, CBI Director-General, said: 'We are particularly worried that an uncompetitive corporate tax system is spoiling the UK's attractiveness as a place to do business, and that other internationally-mobile firms will follow Shire's path.'

FTSE 100-listed Shire, the third-largest pharmaceutical firm in the UK, is set to pay significantly less tax by becoming a tax resident in Ireland.

The company re-assured market concerns over the change of residency, saying the change would not affect Shire's UK operations or workforce. But this will mean a loss of income for the Treasury, the Telegraph reported.

A company statement said: 'Shire has concluded that its business and its shareholders would be better served by having an international holding company with a group structure that is designed to help protect the group's taxation position, and better facilitate the group's financial management.'

Further reading:

Shire quits UK for tax efficient Ireland

Shire to introduce a new UK-listed holding company

UK in bottom half of best tax regime table