ING marketing agency WPP is unlikely to return its tax base to the UK even if the Treasury reforms the corporate tax regime, it emerged yesterday.
Sources close to the company said it would not be bounced into a “knee-jerk” reaction over the reform of controlled foreign company tax (CFC).
WPP moved its tax base to Ireland in 2009 citing the CFC regime as the reason. Since then several other companies have followed including Henderson Group, pharmaceutical firm Shire and United Business Media.
There have been hints that WPP could return its tax base to the UK, and George Osborne also made a personal plea to Sir Martin Sorrell, WPP’s chief executive to do so in June.
But a source told City A.M: “There can be no guarantees. Whatever this administration may put in place with regard to CFCs, the danger is what happens if this administration isn’t in power?”
“WPP is pretty supportive of some of the things this administration has done, but there is no knee jerk reaction to these moves; there can not be any guarantees”
Meanwhile, Shire said it would remain cautious as to the proposed reforms. A spokesperson said: “We will follow the development of any UK proposals, and when we see any actual legislation we will consider its implications.”