As every year, KPMG Luxembourg conducts its "Luxembourg Business Compass" study that measures the confidence of Luxembourg entrepreneurs for the next 12 months of the year. This time, according to the 61 entrepreneurs surveyed, the trend is further confirmed as it has for almost 7 consecutive years over the last 12 months, the confidence index in the Luxembourg economy increased from 1.1 to 1.6 in entrepreneurs.
"Entrepreneurs are confident, and we are confident! Luxembourg's perception of entrepreneurs competitiveness as a business location of choice has never been so high since we began this study in 2009. Just after the crisis, it must be remembered ... Luxembourg is still perceived by the majority of study participants as an innovative space that is dynamic, flexible and endowed with easy access to the same policy-makers if they wish more initiatives taken at reforms that will enable lead to better reinforcement of the economic infrastructure. Access to some very specific skills and profiles also remains a concern that still persists this year," commented Gilles Poncin, partner at KPMG and head of the study.
If this general trend helps almost all entrepreneurs to be happy, they are however more mixed on some more specific elements, particularly in connection with government reforms. Indeed, when asked about the new reform on corporate tax, the feeling of the majority of participants remains fairly neutral.
"Overall nearly 50% of entrepreneurs see the implementation of the tax reform in a neutral manner; while good news, the percentage of entrepreneurs who see some degradation of the tax environment is reduced from 69% a year ago to 38% now. To return to the tax reform, we can say that the expected positive impact is not really there yet for entrepreneurs. Besides, this is confirmed by the fact that 70% of participants believe that this reform will have no direct impact on their businesses," said Georges Bock, Managing Partner of KPMG.
Finally, the National Action Plan for Employment (the law called "PAN") is criticised by the majority of entrepreneurs. In fact only 11% has to implement it in their companies.
"The results are positive, entrepreneurs are confident. The study was conducted before the results of the Brexit referendum have been announced. It remains to see if they would have responded similarly if they had seen the post-Brexit uncertainty. The answers could have been totally different," noted Patrick Wies, partner and head of the public sector at KPMG Luxembourg.
