Singapore has reserved the status as the best country for doing business in 2015

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Singapore is again acknowledged as the most appropriate place to run private business. According to the results of joint research of the World Bank and the International Finance Corporation, which subject was the profound analysis of business conditions in different countries, Singapore has been holding on the lead position for more than 7 years.

Only 40 years ago, Singapore was one of the poorest countries in the world. Today, the city-state of Singapore has a high level of income with a high level of control of the economy by its government. The average gross national income per capita is up to US $ 54,040. Only in this country you can get financing for business ideas bail.

The report “Doing Business” (Doing Business – http://www.doingbusiness.org/rankings) – annual research of the World Bank that evaluates the simplicity of business realization at 189 countries, based on TOP 10 indicators. The report focuses on the evaluation of regulations governing the activities of small and medium-sized enterprises throughout the business life cycle, and their adaptation in practice.

Report has been drawn up since 2003.

singapore-best-country-for-business-2015

The advantages of running business in Singapore in 2015

Concerning all these indicators, Singapore – really good place to start a business. A number of factors facilitate this:

1. The process of registering a company takes from several hours to several days. Submission of various applications, obtaining the necessary permits and licenses are mainly done through the Internet. In Hong Kong, it also takes a bit of time – eight days. For comparison, in Japan, this period is 23 days, in Germany – 15 days, in Ukraine it can take up to 27 days.

Indicator Singapore East Asia and Pacific region OECD
Procedures (quantity) 3,0 7,3 4,8
Terms (days) 2,5 34,4 9,2
Value (%  per capita income ) 0,6 27,7 3,4
The minimum paid-up capital  (% Gross income per capita ) 0,0 256,4 8,8

2. Singapore is assumed to be №1 spot in 2015 for international trade.

3. Obtaining a building permit takes the shortest period – 10 procedures in 26 days. In this case, the cost is 0.3% of the average income per capita.

4. The accession to power grids occurs in 4 procedures, and it takes approximately 1 month. For comparison, in East Asia it takes about 77 days and costs 30 times more expensive!

5. Registration of property just goes to 4 treatments for 4-5 days and costs only 2.8% of the property value.

Indicator Singapore East Asia and Pacific region OECD
Legal Rights Index (0-12) 8 6 6
Credit Information Index (0-8) 7 4 7
Number of people who are registered in the public register  (%  of the adult population ) 0,0 11,0 12,1
Number of people who are registered in private offices  (%  of the adult population ) 50,8 20,4 67,0

6. In obtaining of loans, Singapore takes the 17th place out of 189 countries

7. Singapore takes the great place in question of protection of minority investors and yield only to New Zealand (1st place) and Hong Kong (2nd place). The city-state has a very strong rate of performance.

8. Very low taxes. Singapore applies the territorial principle of taxation, which means that the income tax is being charged only if the income received in Singapore or if it is translated to Singapore from foreign subsidiaries.

9. First place in international trade also receives Singapore. You need only 3 documents for trading the import or export of products. In addition, the price will pleasantly surprise you!

10. Enforcing Contracts. The first place as well!

Indicator Singapore East Asia and Pacific region OECD
Terms (days) 150,0 553,8 539,5
Court taxes (% of claim costs) 25,8 48,6 21,4
Procedures (quantity) 21,0 37,2 31,5

In addition, it is necessary to note that English is the official administrative language of the city-state, which facilitates transactions with executives and businessmen from other countries. The second business language in Singapore is Mandarin – dialect of Chinese.

Why Singapore is beneficial for those who work with China?

China itself has sufficiently high taxes, but the production is much cheaper. In order to minimize your taxes and expenses you should better to start a business in Asia.

Singapore and China have already established strong business and trade relations. In 2011, the mutual trade between China and Singapore has reached a volume of about $101.4 billion in Singapore dollars. In addition, export of services by Singapore to China has risen nearly 5-fold from $1.3 billion in 2001 to $7.4 billion in 2010.

A few weeks ago, there was a meeting in Beijing between Minister of Trade and Industry of Singapore, Lim Hang King, and Minister of Economy of China, Chen Deming. The meeting focused on ways how to improve business and trade cooperation between Singapore and China, including support for trade in human services.

Taxes in Singapore

Tax rates in Singapore are not only competitive, but are also among the lowest in the whole world. While Singapore only lowers its tax rates, most of the world makes them a furious pace.

  • Low corporate taxes. Business in Singapore is taxed at 17%, with the possibility of various deductions and exemptions (depending on the age and type of its activities).
  • Low taxes on personal income. Taxes on personal income may be from 0% to 20% maximum.
  • Low VAT. In Singapore, the VAT is also called Goods and Services Tax – Low Goods and Services Tax (GST). VAT rate in Singapore is 7%, with VAT included it is still lower than the average global rate of VAT/GST 16,4% and Asia-Pacific – 10.5%.
  • The territorial system of taxation. There are 4 main principles on which the Singapore company income may be taxed: 1) In case the foreign source income is transferred to the bank accounts in Singapore; 2) If the company has a full-featured office in Singapore and leads all activities from it; 3) If the goods are geographically cross the border of Singapore; 4) In case the company does business with other Singaporean companies. The tax system in Singapore also allows you to split the income on taxable or not taxable.
  • One-tier tax system. Dividends to shareholders in Singapore are not taxed.
  • There is no inheritance tax.
  • There is no capital gains tax.
  • In Singapore, there are tax benefits in the form of exemption from tax payments or tax cuts for the industry in which Singapore intends to become a leader. A great amount of these industries and the fact that Singapore will become a world leader in them – is inevitable.

In addition to low taxes, leaders rating of economic freedom attract billions of dollars in investments greenhouse conditions of doing business. “We were glad to welcome every new investor – Lee Kuan Yew recalls the first steps of the reform. – We just climbed out of the skin to help it start production.”

As in many other countries, Singapore also gives a choice of tax status.

Singapore, in terms of opportunities for asset protection, offers perfect trust legislation.

Free trade between Singapore and other countries

Double taxation treaties and free trade agreements between Singapore and other countries – is another important advantage for setting-up a business in Singapore.

You will get more profit if you decide to conduct your business through Singapore to China and not only because of the very low taxes, quick registration and the complete absence of corruption. Singapore can be called “Without risk of loss” for opening your own business.

For more information and registration information in Singapore please, be so kind to contact us. Our specialists are always glad to help and provide you with the best service.