Sony and Activision over UK tax breaks

[Khuutra]

Soleron said:

KylieDog said:

Without incentives for external sources to invest in the UK instead of elsewhere its just going to make things worse which obviously is not good for the UK, hence the Sony/Activision statements.

The only incentive should be the fact that the resulting business is viable and profit-making. At least if you believe a free market produces optimal use of resources.

Classically, it isn't the function of governments to compete to offer the most tax breaks in order to get investment. Companies should choose the location because it has the lowest costs, hence reducing end prices (and in terms of goods, lowest costs mean it is optimal for the company to be sited there, hence using the Earth's resources most efficiently). Government involving themselves mean companies choose places with suboptimal cprofit potential and hence resources are used suboptimally.

So you're saying that if companies see the UK as a suboptimal environment, then they should leave the UK as a place of business?