Lower taxes behind WPP bid to move HQ back to UK

Advertising giant WPP has confirmed its intentions to relocate its headquarters to the UK after its self-imposed, four-year low-tax exile in Ireland.

The return was prompted by the twin events of the coalition government's more favourable corporate tax laws that reversed those introduced by Alistair Darling, and the debt crisis afflicting the eurozone.

Sir Martin Sorrell, who heads up WPP, moved its HQ to the emerald isle in 2008 in a bold bid to dramatically reduce its tax payments and take advantage of Ireland's 12.5% corporation tax rates.

But following the UK government's announcement earlier this year that profits of foreign subsidiaries will not now be subject to tax unless an exemption is met, the seeds were sown for a return.

Under the new rules, a charge will only kick in on the proportion of any overseas profits 'artificially diverted' from the UK.

WPP's board has already agreed the return to the UK and will now ask its shareholders to vote on it in December.

The media giant has announced pre-tax profits of £358m - a 7% rise from £334.3m - for the six months to June 30.

But it flagged a slowdown in US revenues tempered by a strong performance in the UK and faster-growing markets such as Latin America were doing well.

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