Cameron snubs CBI
David Cameron has snubbed the CBI conference, deciding to go to Iraq instead.
I have always got on well with CBI people, but I have to confess I think skipping it is a good plan as far as Cameron is concerned.
The CBI repeated its claims that companies are all about to leave the country today, saying that business taxes are too high.
I think there is a strong case for lowering business taxation, in that corporates drive prosperity. There is a sense in which we all benefit, from employment, from investment in ideas and from the sense of properity and wealth created, when businesses are making significant profits (not to mention the more direct link in dividends paid out to our pension funds).
But the CBI endlessly makes the case for lower business taxes, and does it on the basis that business is awfully hard done by. Which I don’t really buy.
But the suggestion of a flood of departures is unlikely. The UK is a great place to be to do business, given the respected regulatory climate, and, as we have all seen, the light burden of listing on UK markets.
The only real possiblity here is that companies could through various accounting tricks locate their HQs offshore. That carries reputational risk, but probably not a significant one. At the risk of alienating those who think it’s legitimate for companies to do that, I’d say there’s a good case for HMRC making the situation so watertight that companies can’t do it. If you’re a British company, you’re a British company.
The problem is not so much whether or not the CBI is right, it’s that it moans and bleats so much. It’s tone is so negative, at a time when British business has much to be happy about. Realistically, the tax situation is not that bad. When you are a politician trying to associate yourself with positivity, a can-do rather than a self-pitying attitude, I’d say it’s right to give this one a wide berth.