Home for Business? Assessing the Competitiveness of the UK

Home for Business? Assessing the Competitiveness

The UK has closed the gap on Ireland as an attractive place for business, according to KPMG’s annual survey of tax competitiveness.

Partner and Head of International Tax & Treasury

KPMG in the UK

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The UK remains one of the most attractive destinations for business, according to over 100 of the largest UK listed companies and foreign owned subsidiaries participating in KPMG’s tax competitiveness survey, an annual review of the UK’s tax regime, when compared to international competitors. Despite Ireland just taking the top spot again in 2015, the UK has significantly closed the gap, building on its 2014 score in terms of the frequency with which UK respondents cite it as being in their top three most competitive tax regimes. The Netherlands score also improved, however Ireland, Luxembourg and Switzerland all lost ground in the rankings.

For the first time this year, 65 non-UK companies in six countries (India, China, Japan, Australia, Canada and the USA) were also surveyed and asked to select their ‘top three’ most competitive tax regimes. The majority of respondents included the UK in their ‘top three’, placing the UK alongside Luxembourg as the most popular tax regime for non-UK companies.

Robin Walduck, tax partner at KPMG in the UK, commented: “When we first published this survey a decade ago the attractiveness of the UK’s tax regime was in question as a number of high-profile companies had announced plans to relocate business activities out of the UK. The dial has moved since then with the number of companies looking to relocate falling sharply. Now, the UK is generally seen as an attractive place to live, work and do business and has shown a renewed ability to attract and retain some of the world’s most valuable companies.”

Key findings from the survey this year include:

  • The availability of a strong workforce, the UK’s competitiveness and market opportunity help promote the UK economy versus its international peers;
  • The UK is viewed as an attractive destination for inbound investment, political and macro-economic stability were particularly appealing features identified by respondents;
  • UK companies place more importance on the simplicity, stability and predictability of a tax regime than on headline rates; and
  • Businesses are broadly supportive of tax transparency and the OECD’s base erosion and profit shifting (BEPS) initiative.

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