Why the U.K. is attracting U.S. firms
Oil drilling company, Ensco International, says it's moving its headquarters from Texas to the United Kingdom. Why? Alisa Roth reports.
British flag (Carl De Souza/AFP/Getty Images)
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Steve Chiotakis: Oil drilling company, Ensco International, says it's moving its headquarters from Dallas to the United Kingdom. It's all about getting closer to customers. And better taxes. So what, you say? Marketplace's Alisa Roth explains.
Alisa Roth: If your company has its headquarters here in the U.S., Uncle Sam wants a piece of the profits. No matter where you make that money. But the United Kingdom just switched from that worldwide taxation to a territorial system. So if your company is based there, you only pay U.K. taxes on money you earn in the U.K. Then if you earn money in France, you pay French taxes on it, and so on.
Roseanne Altschuler is a director of the Urban Brookings Tax Policy Center.
ROSEANNE ALTSCHULER: The U.K. may not have looked attractive as a headquarter location as a worldwide country, but now that they've gone territorial, they may be just attractive enough to get the U.S. corporations to move there.
And she says once companies move their headquarters abroad, other operations may follow. She says it's hard to know how much tax revenue would be lost if American companies started moving abroad en masse. And there is a law that makes it hard to leave just to avoid American taxes.
I'm Alisa Roth for Marketplace.
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