A top Estonian fintech is reassessing whether London will be its new global headquarters, in light of business tax rises announced in the UK budget.
Tallinn-headquartered Tuum, a fintech which provides core banking and other banking infrastructure services, is currently assessing whether to switch to a new global headquarters.
Tuum CEO Myles Bertrand said one reason Tuum was “assessing” relocating its headquarters was because of funding implications.
He said:
"It is interesting for businesses like ours. Being an Estonia-headquartered company, as we continue to grow, there is always the push for us to move headquarters to a more recognised financial hub.
“Quite often if you are looking to get investment out of the US and some of the other markets, they like you to be in London, as it’s seen as the fintech capital of Europe.”
Earlier this year, Tuum carried out a €25m funding round, led by CommerzVentures.
This week, the UK government announced a series of business tax rises, including a rise in National Insurance employer contributions, and Capital Gains tax rises while businesses also have to contend with a rise in the minimum wage and new workers' rights being introduced.
On the impact of the budget on its new HQ plans, Bertrand said:
“I think we would have to assess what that impact would mean for us particularly around Capital Gains and things like that, as to whether does London continue to be an attractive option for business?
“There’s a lot of other countries in the EU which really encourage businesses. It would probably put a pause on our view on that and we probably need to do some analysis and see what does the budget impact have on a business like ours."
Tuum, which employs 120 staff in total, currently has a London office with 12 staff in it, along with offices in Estonia, Spain and the UAE. Bertrand said the budget would not impact staff numbers in its London office.
Other viable new headquarters for Tuum, said Bertrand, would include Amsterdam, Barcelona and Dubai.
However, he stressed that Tallinn, which is known as a tech and innovation hub with incentives for startups, was an “attractive” headquarters for Tuum.
Separately, the CEO of UK business bank Tide, which offers business banking in the UK, India and Germany and employs 2,000 staff, said the National Insurance employer tax increase didn’t “make life easier” for Tide but was “absorbable”.
Oliver Prill, Tide CEO, said:
“I think if you are a larger business and Tide falls probably into that category of being a larger business.
“That sort of increase, to my mind, is absorbable. For Tide, I don’t think it will have any implications directly, neither hiring or wage growth.”
On the budget more broadly, he said:
“It doesn’t make it easier. I don’t think it’s dramatic on Tide itself. It is challenging for our members.
"Clearly we would have wished the Capital Gains tax element would have been different.
“I think pushing all the National Insurance on the employers is also something that we would have probably not advocated.
“But in the bigger scheme of things I don’t think it will change Tide’s trajectory at all.”
On anything positive in the budget, Prill said it provided “clarity” on the direction of travel.
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