Costs for businesses in Manchester are among the lowest in the world when compared to other large industrialised cities, a new report from KPMG reveals. The research focuses on tax costs and shows that Manchester is more attractive than London from a tax perspective.
It also shows that businesses in the UK generally have a lower tax burden than those in other European countries and in the US. This is hailed as an endorsement of the coalition government’s policy on corporation tax which has been reduced by 2 per cent since 2010.
Other costs taken into consideration in the report include miscellaneous local taxes like business rates. These can vary greatly within the same country and can have an impact on where businesses choose to locate. This is where Manchester has the advantage over London.
Fifty five cities were surveyed during the research, which shows that Paris has the highest overall taxes in the world. The Indian city of Chennai has the lowest. Manchester has the ninth lowest with St Petersburg in tenth place. Shanghai, Moscow, Amsterdam and Rotterdam follow, with London in fifteenth position.
The six place difference can be explained by a comparison between labour costs in the two cities and the difference in commercial property values which has an impact on the level of business rates.
Chris Morgan of KPMG explained that the overall encouraging performance of the UK shows that “things are moving in the right direction” and he welcomed the government’s commitment to eventually have the lowest corporation tax rate in the G20.
The research involved studying the tax burden on a range of businesses. These include manufacturing, R&D, corporate services operations and others in the digital sector.