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Hands warns Terra Firma may quit UK
Nick Goodway, Evening Standard19.03.08
Guy Hands today threatened to shift his giant private-equity business Terra Firma out of Britain in a backlash against tax changes aimed at his industry.
Hands, best known for paying £2.4 billion for music group EMI just before the credit crunch hit last year, is the first buyout boss to warn he may quit the country after Chancellor Alistair Darling failed to offer any new concessions to the industry in last week's Budget. Several of his tax changes were seen as deliberately targeting so-called fat-cat private-equity executives.
"We are concerned by the recent changes to the UK tax laws," said Hands. "Recent developments in UK policy may well drive global firms and highly skilled individuals away from London at significant cost to the UK economy in terms of lost revenues and lost taxes."
Terra Firma and its staff of 100 people of 20 different nationalities paid a total of £15.2 million in corporation tax, income tax and national insurance last year.
The Budget raised capital gains tax from 10% to 18% and imposed a £30,000 annual levy on non-domiciled workers.
Terra Firma has offices in London, Frankfurt and Guernsey and also owns three non-UK companies.
