February 21, 2017 / 3:27 PM / 3 years ago

Denmark would not oppose Britain turning itself into tax haven

Workers walk to work during the morning rush hour in the financial district of Canary Wharf in London, Britain, January 26, 2017. REUTERS/Eddie Keogh

COPENHAGEN (Reuters) - Denmark would not oppose Britain trying to turn itself into a tax haven to woo companies after it leaves the European Union as it would put pressure on EU countries to increase their competitiveness too, the new foreign minister said.

Chancellor Philip Hammond said last month in Davos it could cut taxes to stay competitive as international banks weigh moving some of their London operations to the continent out of fear Britain would lose access to the European Union’s single market as a result of Brexit.

“I would not forbid an attempt to compete on costs by lowering taxes,” Danish Foreign Minister Anders Samuelsen said in an interview.

“They are free to take such a step, but they have to finance it somehow. It’s not something that you just do,” he said.

Samuelsen is himself an outspoken eurosceptic who says he wants to reform the EU from within.

An attempt by Britain to create a tax haven “could put pressure on our own corporate taxes. Then we would have to follow,” he said.

Prime Minister Theresa May has said she will trigger Article 50 of the EU’s Lisbon Treaty next month to launch divorce talks that can last up to two years.

Samuelsen, a liberal who became minister in November as part of a new coalition government, said he remained optimistic that a fair and balanced Brexit deal would be reached.

“But we have to defend our own interests. This has nothing to do about punishing Britain, but to make sure that any agreements are rational and balanced,” he said.

Editing by Angus MacSwan

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