UK chancellor stands firm despite AstraZeneca factory snub

International Tax Review is part of Legal Benchmarking Limited, 1-2 Paris Garden, London, SE1 8ND

Copyright © Legal Benchmarking Limited and its affiliated companies 2025

Accessibility | Terms of Use | Privacy Policy | Modern Slavery Statement

UK chancellor stands firm despite AstraZeneca factory snub

AZ image.png
AstraZeneca discovery centre in Cambridge, UK | AstraZeneca

The UK’s biggest publicly listed company will build a major factory in Ireland because it believes the British corporate tax rate is too high.

UK Chancellor Jeremy Hunt has said he won’t consider tax cuts funded by borrowing after British pharmaceutical company AstraZeneca announced a new factory will go to Ireland because it has a lower corporate tax rate.

Jeremy Hunt told the BBC on Saturday, February 11, that he was disappointed by the decision and even agreed with the company’s stance but that deficit-financed tax cuts were simply a way of passing the bill to future generations.

It came after AstraZeneca – the UK’s biggest publicly listed company – said two days earlier that it would build a new factory costing £320 million ($360 million) in Ireland, where the headline corporate tax rate is just 12.5% (though this is expected to rise to 15% in 2024).

AstraZeneca described the UK’s corporate tax rate, which is due to rise from 19% to 25% in April and will be the highest it’s ever been, as discouraging.

Former and current Conservative politicians have weighed in to criticise the UK’s approach to corporate tax policy.

Ex-Health Secretary Matt Hancock tweeted that the decision was completely avoidable and a “massive wake-up call”, adding: “Across life sciences, data, AI, clinical trials & other industries of the future, we are squandering a lead, failing to capitalise on the global success of our vaccine programme.”

John Redwood, a member of Parliament for the ruling Conservative Party, also said the announcement showed how damaging the government’s tax policy was and that “high taxes destroy jobs and result in less tax revenue”.

This row comes ahead of the government’s spring budget, which is due on March 15. Chancellor Hunt has already said there are unlikely to be any significant tax cuts in that announcement.

The UK’s corporate tax rate has been something of a political football in the past year. In March 2022, the Boris Johnson government announced a planned rise from 19% to 25% before it was dramatically reversed under Prime Minister Liz Truss in September last year.

Just before Truss departed office a month later, Hunt reinstated the 25% headline rate, saying it would generate around £18 million a year in revenue.

more across site & shared bottom lb ros

More from across our site

Given the US/G7 pillar two deal, the OECD is in danger of being replaced by the UN as the leading global tax reform forum
Cinven’s latest investment follows its acquisition of a stake in Grant Thornton UK in December; in other news, a barrister listed by HMRC as a tax avoidance promoter has alleged harassment
CIT base narrowing measures remain more prevalent than increased CIT rates, the report also highlighted
ITR's parent company, LBG, will acquire The Lawyer, a leading news, intelligence and data-driven insight provider for the legal industry, from Centaur Media
KPMG UK’s Graeme Webster and KPMG Meijburg & Co’s Eduard Sporken outline the 20-year evolution of MAPAs, with DEMPE analyses becoming more prevalent and MAPA requirements growing stricter
Rishi Joshi, of the Institute of Chartered Accountants of India, warns of potential judicial overreach as assets are recharacterised to bypass a legislative exclusion
Only 2% of in-house survey respondents said they were ‘heavy’ users of AI for TP, Aibidia’s report also found
There was a ‘deeply embedded culture within PwC that routinely disregarded formal confidentiality obligations,’ the chairman of Australia’s Tax Practitioners Board said
Jennifer Best was most recently the acting commissioner of the IRS’s large business and international division
Section 899’s exclusion from the One Big Beautiful Bill does not mean it has been nipped in the bud, Aruna Kalyanam also tells ITR
Gift this article