McDonald’s to swap London for Geneva
FAST food giant McDonald’s yesterday confirmed it was joining the growing list of multinational companies to have quit the UK and relocate their European headquarters.
The US chain, which runs 1,200 restaurants in Britain, plans to move from its current headquarters in East Finchley, north London, to Geneva by the end of the year.
McDonald’s joins the exodus of US firms which have shifted their European operations to Switzerland including food manufacturer Kraft, Procter & Gamble, Colgate Palmolive and Yahoo.
The move comes alongside a report that offshore tax jurisdictions within easy reach of Britain are bucking the European property market slump. A survey out today from international offshore tax firm the Sovereign Group shows a surge in demand from wealthy Britons and companies fleeing high UK tax rates has boosted offshore property prices.
Guy Hands, the British financier worth an estimated £250m, recently jumped ship to Guernsey following changes to the UK’s corporate and personal tax system. And Morning Wire revealed in April that drug company Shire was moving to Dublin, following Sir Martin Sorrell’s media group WPP which said last September it was going in a bid to escape higher taxes.
The companies have been exiting the UK in search of more favourable tax regimes since changes to the taxation of foreign profits, announced in this year’s Budget, that mean firms would pay taxes twice on dividends earned on intellectual property rights abroad.
But McDonald’s insists that it still expects its annual tax rate to remain between 29 per cent and 31 per cent.
Seventy per cent of the group’s European outlets are run by franchisees, in return for intellectual property rights which allow them to stock, produce and sell the global burger brand.