Panasonic is poised to move their headquarters from the United Kingdom to Amsterdam in October before Brexit goes live. The goal of the transition is to avoid the tax issues that will be linked to having the headquarters in the UK as they have requested to leave the EU. The aim of the move has been vocalized from the Chief Executive of Panasonic himself, Laurent Abadie.
Brexit officially takes place in March 2019. Panasonic aren’t the only multinational firm to move jobs out of the UK with a lot of other businesses also following suit to avoid the tax implications. Numerous Japanese financial organizations that are currently present in the UK have also expressed that they are planning on moving their European bases out of the UK.
Now what is exactly meant for tax issues and what does it mean for these businesses? Well essentially when the UK leaves the EU, businesses can potentially pay less tax there making it a “tax haven”. However the decision to move is made out of fear that since it is a tax haven, the extra costs will be passed onto a larger tax bill for Japan.
Mr. Abadie told sources that the plan to leave the UK had been in the works for approximately 15 months following the results of the Brexit campaign. Following the claim from the chief executive, Panasonic came out with an official statement stating that the regional headquarters will be moved from Bracknell (UK) to Amsterdam starting on the 1st of October.
Aware of the potential backlash of the Brexit decision, the UK government has claimed that they will strive to cut down corporation tax so that business will stay with them after the transition. However, for a lot of Japanese multinational companies such as Panasonic this decision has ultimately pushed them out of the country due to tax implications in their home country.
Japan is considered a major investor within the United Kingdom where 100,000 jobs are created from 800 Japanese companies. With the Brexit transition fast approaching we may see a lot more companies following suit resulting in loss of jobs for thousands of United Kingdom residents.