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

What does a career in audit involve?

Career What does a career in audit involve?

1d Lucy Skoulding, Reporter
PwC auditor spent just two hours on BHS audit, says chairman

Audit PwC auditor spent just two hours on BHS audit, says chairman

2d Alia Shoaib, Reporter
Managing director of Price Bailey on the British Accountancy Awards and opportunities ahead

Technology Managing director of Price Bailey on the British Accountancy Awards and opportunities ahead

2d Emma Smith, Managing Editor
Clean Air Day: Environmental sustainability in the accountancy industry

Career Clean Air Day: Environmental sustainability in the accountancy industry

2d Lucy Skoulding, Reporter
What we have learned about mental health at work?

Career What we have learned about mental health at work?

3d Laura Noble, Accountancy Age
Does technology lead to success in accountancy?

Technology Does technology lead to success in accountancy?

3d AJ Chambers Recruitment
THE NEW ACCOUNTING KPIs ADDING VALUE FOR YOUR PRACTICE AND YOUR CLIENTS

Cloud THE NEW ACCOUNTING KPIs ADDING VALUE FOR YOUR PRACTICE AND YOUR CLIENTS

3d
Where could an accountancy qualification lead you?

Career Where could an accountancy qualification lead you?

3d Lucy Skoulding, Reporter