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High income taxes could prompt British beverages company to move

October 25, 2011

Here in the United States we keep hearing about how our corporate tax system makes it hard for businesses to compete globally. The U.S. corporate income tax rates, say executives and politicians, are just too darn high.

Guess what? Businesses are singing a similar tune across the pond.

Diageo, a leading maker of adult beverages, is threatening to relocate overseas if the United Kingdom keeps its 50 percent income tax rate.

This time, though, the company is concerned about individual, not business, taxes.

"I believe the 50 percent tax rate will lead to the long-term damage to this nation's competitive edge," said Walsh.

The big problem for the Brent, England-based maker of Guinness, Johnnie Walker, Smirnoff and Baileys just to name a few, is hiring and keeping top executives at the company.

Diageo booze brands2

The money that Diageo offers for these corporate slots is good, but the employees don't like paying England's high personal income taxes.

"We will not be able to base people here and increasingly we will have to look at locating our quality people in lower tax jurisdictions," said Walsh.

Of course, moving staff to other countries with lower taxes wouldn't hurt Diageo either.

"If I employ staff in Singapore with a 10 percent tax rate, I don't have to pay them as much for them to feel good and to go home with more money," said Walsh.

That's certainly something that the Diageo accountants can raise a glass to toast!

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TO WRAP UP 2026

It’s over! With October’s extended filing deadline behind us, it is now time to focus on year-end moves to reduce your 2026 tax bill. 

You’ll find ways to do just that on the Tax Tips page (see the More Tax Posts drop-down menu at the top of the blog), as well as the separate tax tip pages for each month, notably October through December. If you’re on the Tax Tips page, you’ll find a monthly list at the end of this column. If you’re on another blog page, you can head straight to the October tips; at the bottom of that tips page you’ll find links to all the other 11 months’ collections of tax advice.

Not to spoil what you’ll find in that tax advice, but it does cover such things as tax deductions for charitable donations, investment moves that could reduce tax due, and ways to max out your tax-favored retirement savings. 

Finally, as the year winds down, things get hectic. There are lots of other things to occupy our time, like the much more fun upcoming holidays. But don’t lose sight of taxes, since timing is key. To be of use, most tax moves must be made by the end of the tax year. That’s Thursday, Dec. 31, which also is the last business day of the year. 

So that you don’t miss that final tax year deadline, also keep an eye on the countdown clock below. It will keep you on top of just how much time is left to make important, tax-saving moves. (Note: I’m in the Central Time Zone, so adjust accordingly for where you live.)

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