Drugs firm snubs UK for Ireland over taxes
CHANCELLOR Jeremy Hunt said he was disappointed the UK “lost out this time” on a £320million AstraZeneca factory after the drugs giant chose low-tax Ireland.
Sir Pascal Soriot, chief executive of the pharmaceutical group, said he had wanted to build a plant by its existing sites in Cheshire, but the “discouraging” tax rate had prompted the switch to Dublin.
Mr Hunt said: “We’re disappointed that we lost out this time and we agree with the fundamental case they’re making, which is that we need our business taxation to be more competitive.
“And we want to bring business taxes down.
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“But the only tax cuts we won’t consider are ones that are funded by borrowing because they’re not a real tax cut.They’re just passing on the bill to future generations.”
Mr Hunt said the UK’s life sciences industry was “tremendously strong”.
He added: “If you look at life sciences, we have billion pound investments announced recently by BioNTech, by Moderna, by other big pharmaceutical companies, and we think we are in a tremendously strong position with the biggest life science sector in Europe.”
The corporation tax rate is due to rise from 19 per cent to 25 per cent in April, while a tax relief scheme for businesses is expected to end. AstraZeneca has warned the UK for some time not to take its life sciences sector for granted, adding that it is losing out on investment to more competitive countries.
Dr Richard Torbett, chief executive of the Association of the British Pharmaceutical Industry, called for Government action to provide a “level playing field”.
He said: “There are more stories about losing investment, like the one we’ve seen with AstraZeneca, than the positive noise stories coming in, and we really have to turn that around. “The agreement we have has got to the point where companies are now paying more than a quarter of their revenues – not profit but revenues – back to the Government.
“That is vastly in excess of anything the industry pays anywhere else in the world.We have to get to the point where the UK is able to compete for investment on a level playing field, and we are not there yet.” Concerns within AstraZeneca have been focused on the NHSbranded medicines sales levy, which has soared due to rising demand since the pandemic.