The rising tide of anger against Treasury tax proposals intensified yesterday after Old Mutual, the £7 billion London-listed insurance group, revealed that it had considered relocating to a lower-cost regime. The company, which has its roots and a second market listing in South Africa, said that it had explored moving its headquarters to a city such as Dublin or Geneva.

The FTSE 100 group, led by Jim Sutcliffe, the chief executive, said that it was reacting to proposals by the Treasury to tax companies on foreign profits. [“We decided] there would be limited benefit in changing our structure,” a spokesman said. “We have a sizeable head office function in the UK. But, as with the rest of UK plc, we are concerned at the complexity of the tax regime, which continues to work against the UK as a place [in which] to do business.”

A spokesman for the company said that although it had decided against a move, it would keep the situation under review and would not rule out quitting the UK in tax terms in future.

Meanwhile, The Times has learnt that British American Tobacco, Britain’s twelfth-largest company, paid no UK tax last year. On pre-tax profits of £3.08 billion, the company faced a UK tax charge of £977 million, but this was cancelled out by foreign tax credits, adjustments and deferred charges. A spokeswoman for BAT confirmed that the company paid no corporation tax in the UK during 2007.

Many companies domiciled in Britain say that the proposed tax on foreign profits is the final straw in the wake of rifts over capital gains tax changes and the “non-dom” issue of taxing foreigners who work in the

UK but live abroad. Yesterday, GlaxoSmithKline (GSK) and Aberdeen Asset Management, a leading British fund manager based in Scotland, joined companies including Brit Insurance, the Lloyd’s of London underwriter, United Business Media, the publishing group, and WPP, the advertising giant, in considering their position over the taxation issue.

Jean-Pierre Garnier, the chief executive of GSK, said in an interview yesterday: “We have to wait and see what comes out. We are part of the process. The Prime Minister understands the need for GSK to compete globally. We cannot operate out of an environment that is not supporting us. So far we have had an excellent relationship with the UK.”

BAT, world’s second-largest tobacco company, notes that more than 99 per cent of its sales are outside the UK. Paul Murphy, an accountant with Tax Research UK, said: “This is not a freak.” He estimated that between 2000 and 2007 BAT paid only £69 million in UK corporation tax, despite notional UK tax charges of £4.452 billion. Almost all of these charges were cancelled by foreign tax credits, meaning that in most years, including 2002, 2003, 2004 and 2007, BAT paid no tax in Britain. In 2005 it paid £42 million and in 2006 it paid £14 million. Details of the company’s tax position were contained in its annual report, published last month. BAT executives said that they were supporting lobbying efforts intended to persuade the Government from changing the tax regime, which would alter the basis on which overseas earnings were taxed in the UK. Such reforms potentially could seriously damage BAT’s generous tax treatment if it remained domiciled in Britain.