Britain offers huge savings on corporate taxes
Who doesn’t love a business with American roots that holds their corporate office right here in America. America, people! We all love it, that is until it means higher prices. And these higher prices are largely due to the whopping 40% corporate tax businesses have to pay in the good, old US of A.
Hopping the Pond
That’s also why it comes as no surprise to see many international businesses leave for greener pastures in Great Britain. To go from paying 40% to about 20% in taxes is a massive bonus for any corporation. The English speaking country has worked immensely hard to become one of the lowest taxing countries in the G20, and it’s paying off. Attracting new businesses will be of major assistance throughout the “Brexit”, and help bring some stability to the land.
The biggest move that’s attracting a lot of attention lately is McDonald’s move from Luxembourg to Great Britain. The EU is investigating unlawful tax deals in Luxembourg, which may have played a part in the fast food company’s transfer. McDonald’s is claiming, however, that the reasons for the move are the fact that English is the main language spoken and that the business structure aligns better there. Will they follow Starbucks and Amazon’s lead of avoiding British taxes? Are they to be the next company to undergo a trend aptly called “tax shaming”?
Either way, the they’re not the first to make a move. Companies have been setting up base in England since 2012 for the tax benefits. Even the british workers have had a pretty brilliant idea. Corporate taxes in Great Britain are so low that about 600,000 people set themselves up as a limited company in order to save a good chunk of cash for themselves. We’ll see how long this lasts, however, because the HMRC is looking out for this shady practice.
Companies can look to the future as well, as British parliament has laid out intentions to cut taxes even more, to 17%, by 2020. Theresa May, Prime Minister of the United Kingdom wants to push the issue even further, and get their number below 15%, which would make Great Britain the country with the lowest corporate tax in the top 20 economies in the world. It would be an incredible feat for England, but not a huge surprise. Since the brexit, the country has been in much better shape than anyone could’ve imagined. They’re even looking to invest 2 billion pounds in order to be on the cutting edge of everything science, tech and overall innovation.
While we won’t speculate on England’s future too much, it’s a fact that there’s a tax paradise for international companies just waiting to be taken advantage of. Moreover, new businesses and new jobs mean a needed boost for the British economy, as the pound has dropped since talks of a brexit began.