Lower corporate tax rates attract foreign investment

Lower corporate tax rates attract foreign investment

Big GDP and low tax rates are key to foreign direct investment

LOWER CORPORATE TAX rates increases the amount of foreign investment into a country, a report by fDi Magazine, from the Financial Times, has found.

Although a country’s GDP is the biggest determining factor in attracting inward investment, the sample of 46 countries found that corporate tax rates also correlated with inward investment.

With the OECD and G7 looking at ways to counter multinational tax avoidance, changes to tax rates could directly impact on inward investment, the report suggested.

The UK performed slightly better than other European countries, increasing its market share of foreign direct investment to 20.87%, the highest in Europe. The UK and Germany accounted for 45% of foreign direct investment in Western Europe.

While investment declined globally, there were some exceptions: Chile; Spain, Indonesia; Poland and Oman experienced strong growth. Chile has seen 5%+ GDP growth rates, and attracted renewable energy investment attracted to the weather conditions that are ideal for solar power – and electricity demand from the mining sector.

Related Articles

Why so many businesses who think they are compliant with MTD need to think again

MTD Why so many businesses who think they are compliant with MTD need to think again

14h Beth McLoughlin, Managing Editor
Financial Power List 2019: 1-5 revealed

People In Business Financial Power List 2019: 1-5 revealed

16h Beth McLoughlin, Managing Editor
Patisserie Valerie rescued in management buyout backed by Causeway Capital Partners

Audit Patisserie Valerie rescued in management buyout backed by Causeway Capital Partners

2d Lucy Skoulding, Reporter
Will the Human Rights Act be scrapped if we have a no-deal Brexit?

Business Will the Human Rights Act be scrapped if we have a no-deal Brexit?

2d Emanuela Hawker, Reporter
Financial Power List 2019: 6-10 revealed

People In Business Financial Power List 2019: 6-10 revealed

2d Beth McLoughlin, Managing Editor
UHY Hacker Young adds new ex-Deloitte partner to Nottingham office

People In Practice UHY Hacker Young adds new ex-Deloitte partner to Nottingham office

2d Beth McLoughlin, Managing Editor
The challenges of financial transparency in digital advertising

Technology The challenges of financial transparency in digital advertising

2d Federica Bowman, Managing director, Digital, FirmDecisions
Finance professionals must tech-up in the next three years or risk falling behind

Career Finance professionals must tech-up in the next three years or risk falling behind

2d Lucy Skoulding, Reporter