CBI urges government to 'rethink corporate tax'

UK tax policy needs to change in order to prevent companies from following the lead of United Business Media and switching tax residency, it has been claimed.

The Confederation of British Industry (CBI) argues that controlled multi-national companies in the UK are at risk of double taxation as profits made abroad are also subject to tax in this country, making it an unappealing location, Accountancy Age reports.

CBI director general Richard Lambert is quoted by the publication as saying: "Firms are seriously concerned about the high level and rising complexity of taxation in the UK and are increasingly prepared to vote with their feet."

In 1997, the UK's marginal corporation tax rate was among the lowest in the EU, yet it is now the sixth highest, according to the publication.

The CBI is the primary lobbying agency for British business, with 13 UK offices and is calling for the government to work together with other EU countries to coordinate national tax systems.