1 in 5 UK firms moving some business abroad: CBI

By Staff
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Google Oneindia News

London, Nov 27: One in five UK companies have relocated some of their activities overseas and a third are considering it because of gripes over tax, according to a poll by the Confederation of British Industry published on Monday.

Britain's biggest business lobby group said its survey of 87 companies showed 71 percent thought corporation tax should be reduced, as it began its annual two-day conference a week before Chancellor of the Exchequer Gordon Brown's pre-budget report on Dec. 6.

''Our survey shows that business leaders believe the UK's corporate tax regime is more burdensome than it was five years ago, and that this is making the UK less attractive as an international business location,'' said CBI Director General Richard Lambert.

The survey also showed nearly 20 percent of companies had even considered moving their headquarters abroad.

The CBI called on Brown to cut companies' tax bill by 2 billion pounds in 2007/08 and then repeat the reduction annually to achieve a cut in the corporation tax rate to 25 percent by 2011 from 30 percent now.

Brown, who political commentators expect to take over from Prime Minister Tony Blair within a year, will address the CBI conference on Tuesday and seek to reassure firms that he is listening to them, as all political parties to try and capture the business vote.

But government sources say any big changes in headline tax rates are very unlikely in the pre-budget report.

Lambert said he expected no quick fixes.

''However, business needs a clear signal that the UK is going to shift course, first by checking the trend to a more burdensome business tax regime, and then by moving back up the competitiveness league tables,'' he said.

''Finance ministers of individual countries can't make decisions about the appropriate rates for their country ignoring what's going on in similar economies.'' Opposition Conservative leader David Cameron will address the CBI conference later on Monday. His Treasury spokesman George Osborne said he had commissioned a report to see whether business taxes can be simplified.

REUTERS

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