Yahoo! has confirmed that it will move its European headquarters from London to Geneva – just a few skips away from Google, which is now located in Zurich. Yahoo! claims that the move is to “increase financial performance” which has been widely translated as related to taxes.
The announcement from Yahoo! was made only a few days after the Chancellor in the UK presented the new budget. In the midst of a slowing economy in the UK, business leaders and Conservative MPs have been asking for tax cuts for businesses in order to stimulate the economy. Specifically, the Treasury was asked to cut corporation tax to 18%. Cuts were only made from 30% to 28%.
Yahoo! is not the first company heading out of London. Many companies are being wooed to lower tax countries such as Switzerland and Ireland. Kraft has moved its main office from London to Zurich; Experian chose Dublin; and Gallaher, which makes Camel and Salem cigarettes, is also heading to Geneva.
In response to the announcement by Yahoo!, Richard Lambert, the leader of the Confederation of British Industry, said: “We are deeply concerned that the UK corporate tax system is becoming uncompetitive and, without knowing the detail, this sounds like another sign of that.”
