COMPANIES in Milton Keynes should do business with the 50 states in the USA as if they were separate countries, a breakfast meeting was told.
The meeting of Milton Keynes Forum for International Trade (MK FIT) on June 19 was told that many state economies are similar in size to national economies in Europe.
The Californian economy is the eighth largest in the world, Roope Aaltonen, from UK Trade and Investment South East (UKTI) told the meeting.
MK FIT is sponsored by UKTI, international accountancy firm Mazars’ and EMW solicitors.
Mr Aaltonen said: “Although the USA is a single nation, in reality you need to view its regions as separate markets. I personally believe that you need to treat each of the 50 states, and the federal government, as separate markets until proven otherwise. You can group them according to commercial behaviour later.”
David Sayers, international tax partner at Mazars, added: “Only two weeks ago I presented at a well-attended seminar in New York about trading with the UK. It clearly illustrated that plenty of Americans are interested in doing business with the UK.”
Over the past five years, the cost to Americans buying from the UK has fallen by around 20 per cent due to exchange rate fluctuations.
Mr Sayers warned although the USA is a relatively easy country in which to go to market,there are costs and huge reels of red tape surrounding tax. He said: “There are some substantial trading opportunities, but your corporate tax rates can be up to 17 per cent higher than in the UK with 35 per cent corporation tax plus state taxes which vary between zero and 8 per cent,” said Mr Sayers.
“America’s business environment is lightly regulated and it is easy to set up a company. Public filing of accounts is not needed and often auditing is not required at all. However, you need specialist advice to mitigate tax.”