The UK is the third most competitive nation worldwide for digital services, a study has found.
The report conducted by KPMG looked at the business competitiveness of over 100 cities in 10 countries around the world.
The study divided the competitiveness of each country into four industry sectors – digital services, research and development (R&D), corporate services and manufacturing.
Out of the UK, the US, Canada, France, Germany, Italy, Japan, Australia, Mexico and the Netherlands, the UK was determined to be the second most competitive country for corporate services, third for digital services and fourth for R&D and manufacturing.
UK chairman of KPMG, Simon Collins, commented: “There is no doubt that the UK is in a hotly contested international competition for global investment.
“The decisions international businesses make when they locate have an important economic impact on the countries they operate in and can have a powerful social impact.
"The UK has it all; competitive costs and tax and unrivalled innovation, all wrapped up in a place where people want to live.”
The report observed that part of the UK’s attraction for digital-based businesses may be attributed to low corporate effective tax rates (ETRs) for digital services operations.
Chris Morgan, UK head of tax policy at KPMG, said: “The attractiveness of a country’s tax regime should not be under-estimated.
“Our research shows that tax typically represents up to 14 per cent of location-sensitive costs; an important reminder to policy-makers."
Image of digital services courtesy of Shutterstock.co.uk