In a study, based on interviews with 201 UK senior executives online, 56 per cent of respondents said that regulation and compliance costs are the second biggest impediment to business growth than tax.
In contrast, 27 per cent of respondents cited tax as a major concern compared with 38 per cent in a similar study conducted in first quarter of 2011. In the study carried out by the Royal Bank of Scotland (RBS) 81 percent of the respondents said market competition was the first biggest obstacle to business growth.
The study was conducted between 11 and 26 October 2011 by Research Runner for the RBS, involved finance directors, c-level executives, managing directors and treasurers of companies with an annual turnover of over £25m.
The study reveals that tax, which has been an issue for mid and large-sized businesses in the UK, was no longer the number one concern.
Peter Russell, head of manufacturing at RBS CIB, said: “It is worrying that regulation is seen as one of the biggest barriers to growth for UK mid-size companies. While there have been positive strides made, corporate UK clearly feels onerous regulation is still hurting business.
“On the positive side, taxation is now seen as less of a burden by companies, which is important as the UK looks to meet the challenges of low tax jurisdictions.”