Snap Group is setting up a non-US headquarters in its existing London-based UK office, in a surprising move which will see the company pay taxes on UK and some international sales.
While many US companies, such as Apple, Facebook, Google and Twitter, have based their international headquarters in locations like Ireland due to advantageous corporate tax rates, the company behind Snapchat has commented that it has made the move because it believes in the UK creative industries.
“The UK is where our advertising clients are, where more than 10 million daily Snapchatters are, and where we’ve already begun to hire talent,” said Snap Group general manager Claire Valoti.
The European Commission has been cracking down on some tax deals, and the OECD has been pushing for G20 measures on corporate tax avoidance.
Snap’s decision is expected to boost London’s global reputation as a creative hub, particularly with businesses that do not need to physically move goods across borders.
Snap claims to have 150 million daily active users globally, with around 50 million based in Europe.
Apple is currently appealing against a ruling by the European Commission in August 2016 that the company should pay €13bn ($13.75bn) in back taxes to Ireland.
Read MediaCom head of Beyond Advertising EMEA Palle Diedericksen’s predictions for 2017, including Snapchat going mainstream, here.