Cambridge MP Julian Huppert has warned Parliament that Pfizer’s bid for AstraZeneca is driven by tax advantages.
And he asked Prime Minister, David Cameron today (Wednesday, May 7) during Prime Minister’s Questions whether he had spoken to the American government about any changes to their tax law or whether Pfizer had quizzed him on any changes to UK tax law, particularly the Patent Box.
The Patent Box allows companies to apply for a lower rate of Corporation tax to profits from its patented inventions and certain other innovations.
Mr Cameron agreed with Julian that the government should be “hard headed about this”.
He said Pfizer had mentioned the Patent Box as “a positive reason for wanting to invest in Britain and to examine whether they can increase manufacturing in Britain.
“The way the Patent Box works is that you only get low tax benefits if you make your investments and research in the UK and then exploit that research by manufacturing,” he said.
“But I agree with him that we should be incredibly hard headed about this. It is an advantage that Britain is a low tax country.”
And he said he agreed with Business Secretary, Vince Cable’s view that “we want investment, jobs and research and that comes with a competitive tax system”.
Julian said later: “There are still so many unanswered questions about Pfizer’s bid for AstraZeneca. I want to make sure that we understand fully the reasons behind this bid and how it will benefit our economy and our workers.
“We want to encourage investment, innovation, manufacturing and jobs in this country but we need to make sure we are fully in the picture on this.”