Facebook (FB) is the latest Silicon Valley giant to express confidence in the U.K., even as Prime Minister Theresa May drags her feet in providing any concrete roadmap -- at least publicly-- for its exit from the European Union.
However, the social media group's Monday announcement to boost its U.K. headcount by 50% to 1,500 in 2017 follows speculation that the country's finance minister Philip Hammond could unveil sharp corporate tax reductions when he delivers his first budget and finances to the parliament.
It also coincides with an indication by Prime Minister May, the first of its kind, that the government is willing to discuss a transitional arrangement with the EU that could involve staying in the single market and avoid the U.K. from retreating entirely from the economic zone at the end of its Brexit negotiations. She spoke in London to the Confederation of British Industry, the country's largest lobby group.
May also reiterated that she would trigger Article 50, which would start the formal negotiation procedure for the U.K. to leave the EU, by March 2017.
Given that the U.K.'s tech sector relies on overseas workers to fill about 50% of its vacancies, according to some estimates, Monday's events could be a major step forward in helping define the near-term landscape. And if the government were to deliver a corporate tax cut, the U.K. would at least be more attractive than its European peers.
In 2016, the corporate tax rate was 20% in the U.K., compared with France's 33.3%, Germany's 29.72%, Sweden's 22%, and Portugal's 21%, according to KPMG, a Big Four auditor. It also compares with the U.S.' 35%, which President-elect Donald Trump promised to slash to 15%.