According to a filing with U. S. regulators, Fiat Industrial is looking forward to move its tax residence to the U. K. from Italy after its planned merger with unit CNH. The move by the truck and tractor maker will bring down its tax bill.

According to its financial account, Fiat Industrial paid 536 million Euros in tax last year at a whooping rate of 36%. Moreover, it paid 28 million Euros for a regional tax on a net profit of 921 million Euros.

The U. K. has been making changes in the tax policies to sharply cut tax rates in recent years. The corporate tax rate in the U. K. has plummeted from 30% in 2007 to 20% in 2015.

Also, the U. K. relaxed its controlled foreign company tax rules from the beginning of 2012 in a bid to woo companies to have their headquarters based in Britain. The new rules will have companies to pay tax on profits generated in Britain and not on profits earned overseas.

However, the U. K. government has been concerned of international companies that make billions of pounds of sales in Britain, but pay little tax because they are based elsewhere.

The prospectus said FI CBM intends to operate after its mergers in a manner that it is treated as a resident in the U. K. for tax purposes.