McDonald’s to move non-US tax base to UK
As the Brexit vote prompts companies to accelerate in moving onto the continent, one corporate juggernaut is reversing through the drive-thru.
Fast food icon McDonald’s today announced it would move its tax base from Luxembourg to the UK, after facing increased scrutiny from EU regulators.
The news of a new international holding company based in Britain for the hamburger chain comes against a tide of companies looking to the European continent after the UK voted to exit the EU in June.
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McDonald’s said it would pay corporation tax to HMRC and would be responsible for looking after royalty revenues received from licensing the famous chain’s intellectual property rights outside the US. The move will help cut costs.
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“We are aligning our corporate structure with the way we do business, which is no longer in geographies, but in segments that group together countries with common market and growth characteristics,” McDonald’s said.
The reorganisation comes amid an investigation by the EU into what it says are sweetheart tax deals that smaller states in the bloc offer to multinational companies to lure jobs and investment.
In August, the EU ordered Apple to pay Ireland unpaid taxes of up to €13bn (£11.6bn), ruling that the iPhone maker had received illegal state aid.
McDonald's potentially faced an order from the bloc to pay back taxes of $500m to Luxembourg, the Financial Times reported in September.