Business Cost Advantages
CANADA aerospace scores twice #1 in the world for:
Canada is the most cost-competitive country for aerospace (Table 1):
Compare Canada’s business cost to the United States and you will see some major differences (Source: 2004 KPMG world business cost study) :
- 7.1 per cent cost advantage in production costs
- 21 per cent for R&D; ( Canada has very unique tax advantages for R&D; spending)
- 6 per cent cost advantage for manufacturing operations
The same study also shows Canada’s cost advantages in:
- Labour and Benefits: Salary levels up to 24 per cent less and Canada’s labour costs are significantly lower than those of the United States.
- Electricity: Canada offers the lowest costs for electricity
- Facility and Transportation: Some of the lowest costs for industrial land and construction, office leasing, and telecommunications
- Corporate income tax rates: Canada has the best corporate income tax rates for research and development operations and one of the lowest corporate income tax rates for manufacturing operations.
Canada ’s business environment ranks among the world’s best
Canada understands the importance of its business community and has created an environment that encourages success. Canada’s strong conditions for growth include:
- Account surplus for seventeen straight quarters
- Most favourable tax treatment for R&D; among the G-7
- Low inflation
- Low interest rates
- Trade policy and unique access to the North American market
- Innovation policy is a federal priority
Canada ranks No. 1 for best business environment: According to the Economic Intelligence Unit’s global business rankings for the forecast period 2004-2008.
|
Table 1: Business Costs Advantage by Type of Operation
(Index: U.S. = 100.0) |
|
Operation |
Canada |
U.S. |
|
Manufacturing |
94.0 |
100 |
|
Aerospace |
92.9 |
100 |
|
R&D; |
79.0 |
100 |
|
Source: KPMG, The Competitive Alternatives G-7 Edition (2004)
* Index based on after-tax cost of start-up and operation over 10 years. |