Diageo issues 50% tax rate threat
Drinks company threatens to move abroad and says it is not creating top jobs in UK
DRINKS MANUFACTURER Diageo has threatened to relocate overseas if the 50% income tax rate is retained.
Paul Walsh (pictured), its chief executive, said he was no longer creating senior jobs in the UK because of the top rate of tax.
“I believe the 50% tax rate will lead to the long-term damage to this nation’s competitive edge,” he told the Mail on Sunday. “We will not be able to base people here and increasingly we will have to look at locating our quality people in lower tax jurisdictions.”
The business, which makes Guinness, Johnnie Walker, Smirnoff and Baileys, is based in Brent, north London. But Walsh added: “At the moment, if I am going to create jobs, I am not going to create them in the UK because it’s a high-cost environment. If I employ staff in Singapore with a 10% tax rate, I don’t have to pay them as much for them to feel good and to go home with more money.”
A study published by Lloyds TSB showed that 15% of Britain’s 5.5 million expatriates have cancelled plans to return in the UK.