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Advice to Directors

Manufacturers warn Gordon Brown of coporate 'exodus' over tax regime - Telegraph

Gordon Brown risks a corporate exodus because of the high tax regime in Britain, a leading business organisation has warned.

Martin Temple, the chairman of the manufacturers group EEF, told the Financial Times: "There is a point whereby if you lose confidence in the system and it starts to become expensive, you start thinking about this [and] it becomes a boardroom agenda item ... We are absolutely on the edge of that."

Mr Temple added: “We are getting examples now of quite small companies that are moving to Ireland. I wouldn't say it's a major trend yet, but if we don't watch it, we'll get this (exodus). It is very dangerous territory.”

Last week the Treasury moved to try and head off concerns by launching a review into the tax system in the UK, but that may be too little too late, according to Mr Temple.

He said: “The question is will it be effective but fast enough to stop the thought processes that, frankly, started just after the pre Budget report?”

Companies Act 2006 - Even with the new wishy washy "enlightened shareholder value"clause Directors still have a duty to maximise success of the company by exercising independent judgment with skill, care and diligence otherwise they can be personally be liable.
Now if they are not aware that there are tax advantages available by shifting the boardroom and they don't consider them then they are in breech. Of course some directors may conclude continuing to based at the office is better than a monthly couple of days away in Dublin, but they must decide that at a board meeting. And if it annoys the rapacious bastards in charge here, good.

Comments

Everyone is sick and tired of reviews. On a single page of A4 paper, the UK corporation tax could be reshaped to keep businesses in this country. The problem is that Darling cannot afford to lose any more money at the moment, so we are screwed.

I worked in the corporate tax department of a fairly large FTSE 250 company (that was knocking on the FTSE 100 door) until I decided that England had gone too far to the dogs so headed off overseas. One of the things we looked at every year was whether it would be beneficial to move our HQ to Dublin or Geneva. It was decided that financially it was a no brainer (why would you pop into a shop to buy something for GBP30m (the amount of tax we paid) when you could get the same thing from the shop next door for GBP12.5m?

The major stumbling block was whether consumers would turn against us for doing so; and with more and more companies issuing press releases saying that they looking at going abroad it won't be long before the public accept and, importantly, expect you to go to Ireland.

When this happens the floodgates will well and truly open.

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