Oracle CEO urges standardisation of European tax laws

NEWS Oracle founder and CEO, Larry Ellison, has warned European governments to standardise their tax and employment laws or risk seeing big businesses pull out. At a conference in London last week, Ellison claimed the ecommerce revolution will allow businesses to move their operations into countries with lower tax and more flexible employment regulations. "People will migrate to countries that do things most efficiently and have the best workforce, " he said. Ellison said ecommerce will allow companies to consolidate worldwide manufacturing operations and accounting systems. "It's a changing world. You don't need individual human resource or accounting people - you can have one global accounting team. It's a huge economy of scale." He added that countries with strict employment laws - like France - could lose out: "People who shorten their working week are making a big mistake. It's a disaster." Jonathan Steel, chairman of the Bathwick Group, backed Ellison's claim: "It's inevitable that digitisation of business will lead to a flight from unfavourable countries." He added that many European countries like France and Germany have not yet understood the impact of ebusiness and many governments had their "heads in the sand". Ellison had nothing but praise for the UK's tax laws: "The UK's a very attractive place to do business. We expect to see our labour force in the UK growing when some other labour forces elsewhere in the world will not grow." But Daniel Bieler, analyst at Ovum, said Ellison was hyping up the importance of e-business. "Ecommerce isn't the defining element," he said. "This model is restricted to products that can be digitally stored. Car manufacturers, for example, won't move out. People simply like to touch the goods and despite the hype, very few people buy cars online." But Bieler agreed the UK was in a good position for the emerging digital economy. "English is the main language of the Internet," he said, "and the labour laws are more flexible. The UK is mentally geared towards the flexibility demanded by ecommerce."