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Canada ranks 3rd for open for business

Canada ranks 3rd for open for business

Posted by PanamericanWorld on January 21, 2016

In deciding where to bring their business, companies must define their priorities by weighing multiple operating and human costs. National governments face a similar cost-benefit analysis in setting corporate tax rates and policy. The countries considered the most business friendly are those that perceived to best balance stability and expense.

The Best Countries rankings, conducted in partnership with brand strategy firm BAV Consulting and the Wharton School of the University of Pennsylvania, is based on a survey which asked more than 16,000 people from four regions to associate 60 countries with specific characteristics. The Open for Business subranking is based on an equally weighted average of scores from five country attributes that relate to how open for business a country is: bureaucratic, cheap manufacturing costs, corrupt, favorable tax environment and transparent government practices. The Open for Business subranking score had a 12 percent weight in the overall Best Countries ranking.

TOP 5 WINNERS

Luxembourg

#1 in Best Countries: Open for Business

#14 in Best Countries

Corporations in Luxembourg pay a total tax rate of 20.2 percent, according to the World Bank.

Sweden

#2 in Best Countries: Open for Business

#5 in Best Countries

Corporations in Sweden pay a total tax rate of 49.4 percent.

Canada

#3 in Best Countries: Open for Business

#2 in Best Countries

Corporations in Canada pay a total tax rate of 21.0 percent.

Denmark

#4 in Best Countries: Open for Business

#10 in Best Countries

Corporations in Denmark pay a total tax rate of 26.0 percent.

Panama

#5 in Best Countries: Open for Business

#37 in Best Countries

Corporations in Panama pay a total tax rate of 37.2 percent.

Luxembourg is the clear front-runner in this subranking, leading No. 2  Sweden by almost a quarter of the points on a 100-point scale. While perceptions of the nation’s manufacturing costs put it just above the bottom decile, Luxembourg’s tax environment was viewed as the most favorable by a significant margin. This has helped to make financial services the country’s most profitable sector. It accounts for more than a third of gross domestic product, according to The World Factbook, though stricter European Union tax code updates took effect in 2015.

Scarce regulation in banking and tight privacy laws have bolstered Panama’s reputation as a tax haven. From its rank as No. 37 in the overall Best Countries ranking, it hurdled over more than half of the countries to land at No. 5 in the Open for Business subranking.

 

Historically popular outsourcing countries, such as China and the Czech Republic, did not fare well in terms of overall business friendliness. Once considered low-cost countries, economic pressure on wages and manufacturing costs coupled with poor perceptions of transparency in business practices have had a noticeable effect. China landed at No. 42 and the Czech Republic just above the bottom third at No. 39.

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