It’s hard to overstate the bearing a country’s tax system can have on the ease of doing business.
It’s not simply the amount of tax a business has to pay, but the time it takes to pay it. The degree of digitisation can make a big difference – filing taxes online is usually a lot swifter. A higher number of different taxes will usually add to the time spent on compliance.
And when looking at tax rates, you also have to consider whether there are tax reliefs and incentives geared at your type of business (and how easy or not it is to access these). Tax systems need to be considered in the round.
So how does the UK stack up against other countries? Pretty well, according to the latest PwC and World Bank Paying Taxes index. We’re ranked the second most effective tax system in the G20.
Take the time it takes an average medium sized business to prepare and file all its taxes – the global average is 240 hours. A business in the UK would spend under half that time.
