Based in the United Kingdom, Diageo owns some of the world’s most well-known brands, including Guinness and Smirnoff Vodka. According to Walsh, the nation’s new 50 percent higher tax rate on people earning more than ₤150,000 per year is undermining business’ ability to hire, to compete and to manufacture in the UK.

“I believe the 50 per cent tax rate will lead to the long-term damage of this nation’s competitive edge,” Walsh told the London Telegraph.

Because of the tax, he said, his company would likely have to move people to areas with lower tax burdens.

“We will not be able to base people here and increasingly we will have to look at locating our quality people into lower tax jurisdictions,” he warned.

Moreover, he said, his company would not be able to create new jobs in the UK because of the nation’s high tax rates.

“At the moment, if I am going to create jobs I am not going to create them in the UK because it’s a high cost environment,” he said, according to the Telegraph report. “If I employ staff in Singapore with a ten percent tax rate, I don’t have to pay them as much for them to feel good and to go home with more money. This isn’t complex stuff, this is simple common sense.”

As the Obama administration flirts with the idea that high earners need to be punished with higher tax rates in the U.S., it bears considering Walsh’s comments.

Just as in the UK, high, punitive income taxes of the sort favored by the likes of Warren Buffet will not level the playing field and will not result in more income for the poor and the middle class.

Instead what will happen is businesses will be forced to look for lower-tax operating environments, resulting in the loss of jobs badly needed by an already reeling middle class.

This is already occurring in the UK, according to Diageo’s Walsh.

“I think there are more people moving offshore than the press of government recognise,” Walsh told the Telegraph. “It’s happening very slowly, in the tens [of thousands], the 20s, the 30s, but believe me it is happening.”

He continued: “More importantly, we are not bringing people to this country who would be paying 50 percent tax….”

The UK example, as described by Walsh, clearly demonstrates that high taxes do not lead to prosperity.

In the United States, policy makers concerned about income inequality and joblessness would be well served to work for lower taxes, rather than for a punitive increase in income taxes for the wealthy as favored by the likes of Warren Buffet and President Obama.

This article was published in 2011.