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A competitive tax system and business environment is helping to make the UK an attractive destination to set up and run a business, Ernest and Young’s G20 entrepreneurship barometer found.

The UK’s total tax rate of 35.5 per cent, which is far lower than the 49.7 per cent average across the G20, is among the factors contributing to its high ranking.

 

 

The report found that entrepreneurs in the UK have relatively good access to funding, ranking second only to the US.

 

However, Britain trailed behind the US, South Korea, Japan and Australia for entrepreneurial culture and was found to have a weak tradition of mentoring and supporting entrepreneurs.

With only 57.8 per cent of people in the UK going on to third level education, compared to 76 per cent in Australia and 89.8 per cent in the US, the UK also lags behind in educational standards.

 

The study surveyed more than 1,500 entrepreneurs including 55 from the UK to rank countries on funding, culture, tax, education and other parameters.

 

 

Responding to the report, partner at Ernest and Young, Stuart Watson said that the ‘foundations for a strong entrepreneurial ecosystem are already well established in the UK’.

He went on to say that fast growth business account for nearly 60 per cent of all new jobs.

However, he warned against complacency and relying on the government, adding: ‘Domestic demand is set to remain fragile for some time yet, uncertainty still hangs over the Eurozone, while emerging markets are catching us up. The government and firms need to work closely to maintain a competitive financial and regulatory environment and develop an entrepreneurial culture.’