Diageo Boss Decries UK 50% Tax

By ExpatBriefing.com Editorial 25 October, 2011

Chief executive of Diageo, Paul Walsh, has criticized the UK's 50% income tax rate on top earners, stating that the rate was detrimental to Britain’s economy and indicating that his company may relocate to a jurisdiction with less severe taxation.

In an interview with ‘This Is Money,’ Walsh said: “I believe the 50 per cent tax rate will lead to the long-term damage of this nation’s competitive edge.” He added that: “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 ten per cent tax rate, I don’t have to pay them as much for them to feel good and to go home with more money. This isn’t complex stuff, this is simple common sense.”

Walsh also stated that other high earners were already leaving the UK because of the high rate of tax.

The 50% rate applies to annual earnings in excess of GBP150,000 and was introduced by the previous Labour government in 2010 in order to generate more tax revenue and reduce the UK deficit. However, Conservative Chancellor of te Exchequer George Osborne has since described the rate as a “temporary” measure in his 2011 budget speech, and has since suggested that the rate could be reduced as early as 2012.

Diageo’s attack on the 50% tax came after research for Lloyds TSB International showed that 15% of the 5.5 million British expatriates have cancelled plans to return to the UK this year.

Tags: Expatriates | Tax | Business | United Kingdom | Tax Thresholds | Tax Rates | HM Revenue And Customs (HMRC) | Tax Reform | HM Revenue And Customs (HMRC) | Individual Income Tax |

 





News Archive