Britain has climbed up a World Bank league table which ranks countries according to how business-friendly their tax regime is.
Following a series of cuts in Corporation Tax (set to drop to 17 per cent over the next few years) and a concerted effort to reduce the burden of compliance, the UK has risen five places and now sits in tenth position.
The UK’s score also benefited from a new indicator which assesses how easy it is to secure a VAT refund, correct any errors on a tax form and complete a tax audit.
The league table scrutinised the regime of 190 countries around the world by using the example of a fictional manufacturing company.
According to the calculations, the hypothetical firm would (on average) pay tax which was equivalent to around 40 per cent of its commercial profit. Overall, 251 hours would be needed to deal with preparation and compliance.
When the UK was looked at in isolation, the requirements were rather less strenuous. The research suggested that the company would surrender 30.9 per cent of its profits to Corporation Tax and National Insurance and that it would take 110 hours to deal with the administration.
Overall, Britain achieved the highest ranking of any G20 country. Canada was the second best, with a ranking of 17th.
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