According to a report released earlier this week by audit, tax and advisory firm KPMG LLP, Canada ranks as the least costly place to do business – in part due to the country’s technology market. The study compared business costs in 11 industrialized countries in North America, Europe and Asia-Pacific.

Canada stole the top spot with a cost index of 91.0, and was followed closely by Australia at 91.5. According to the report, both countries had average business costs that are approximately eight to nine per cent below that of the U.S.

Japan was highlighted in the report as the most expensive country in which to do business, with costs almost 33 per cent higher than in Canada and almost 24 per cent higher than in the U.S.

The report, entitled Competitive Alternatives, the CEO’s Guide to International Business Costs, measured 27 cost components including labour, taxes and utilities applied to business operations in the 11 countries. The study’s basis for comparison was the after-tax cost of startup and operation for 12 types of businesses over a 10-year span, according to KPMG.

The study indicated that there are significant cost differentials between countries when it comes to establishing manufacturing and corporate services operations and that labour costs typically represent 56 to 72 per cent of location-sensitive costs for manufacturing operations and 75 to 85 per cent for non-manufacturing operations.

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Jim Love, Chief Content Officer, IT World Canada

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