Diageo's CEO, Paul Walsh, has again been heard to criticise UK Government tax policy for driving the company's top people abroad, but global drinks market trends look just as culpable.

When interviewing Walsh, it has become customary to pitch a softball question on tax. His views are well-known and, therefore, the copy pretty much writes itself. Walsh, meanwhile, seems only too happy to persistently remind the powers-that-be of Diageo's concerns.

Under the previous administration, Diageo complained about high levels of corporate tax. Having taken steps to reduce this, the current Government has nevertheless prolonged Diageo's ire by maintaining a 50% tax rate for individuals who earn at least GBP150,000 annually.

In an article in the Mail on Sunday newspaper, published over the weekend, Walsh was quoted as saying that the rate "will lead to the long-term damage of this nation’s competitive edge". He warned that Diageo is struggling to tempt "our quality people" to the UK, specifically because of tax.

For what it's worth, and from what we know, we don't expect Diageo to be going anywhere in the near future. Like the speculation that Diageo is on the verge of acquiring control of Moet Hennessy, rumours of its relocation plans have circulated for several years. If it was really just a case of comparing tax rates, the group would have long since been holding raclette parties in Zug.

At the same time, Walsh is not the only one pressuring the current Government over tax. Top economists, the Organisation for Economic Cooperation and Development and even a report on charitable giving by the Economic and Social Research Council have all said that the 50% rate may prove counterproductive. 

It is possible that a lot of this pressure is borne out of concern that the 50% rate might become a permanent fixture, instead of a temporary political measure.

What puts Diageo in a particularly strong bargaining position on this issue, though, is market trends. Already, 90% of group profits come from outside of the UK. Within three years, moreover, the company expects 50% of its annual sales to be generated in the emerging markets of Africa, Latin America and Asia.  

In a nod to Asia's rise to prominence, Walsh has this year spent a few months based in Singapore. Furthermore, the company's Reserve Brands unit, which houses all the top-notch liquor, and its international business unit have been relocated to Singapore. "If the market is going to grow there, then you clearly need more people there," Walsh told me in typically matter-of-fact fashion following Diageo's full-year results in August.

Via Scotch whisky alone, which by definition requires significant capital to be based in Scotland, Diageo will retain a strong presence in the UK whatever happens to its headquarters. But, it is no secret that the growth lies largely outside of Western Europe, nevermind the UK.

One could argue, then, that a so-called 'brain drain' on Diageo's top talent is being driven as much by market trends as by tax policy. These trends, as much as taxing matters, put Diageo in a strong position to argue for incentives in the UK.