WPP Group expects to move its tax headquarters back to the U.K., from Ireland, chief executive Martin Sorrell told the BBC radio today (March 24). The move is in response to the U.K.’s proposed cuts in corporate taxes and change in the taxation rate of profits earned oversees by companies like WPP, which rings up 90 percent of its revenue outside the country.
For tax purposes, WPP moved its headquarters to the Republic of Ireland in 2008, although its holding company staff remains in London. Sorrell said the change would need to be implemented before the company’s board, with the domain shift initiated later this year or early in 2012.
“There has to be legislation enacted . . . [but] I think it looks as though we will make that recommendation,” Sorrell told the BBC.
After unveiling the U.K.’s annual budget this week, Chancellor George Osborne emphasized that tax changes are necessary in order to make the country more business-friendly to companies like WPP, which have fled its punitive tax policies. The (U.K.) Daily Telegraph has reported that the U.K. Treasury has spent more than six months in talks with WPP’s tax department about reforms.