Dubbed as the ‘Asian Century’, the economic growth of Asia is seeing no signs of distress. China and India are not the only stars of this sparkling economic skyscape but smaller economies are emerging as the rising starlets. The economic might of Asia is growing in mammoth proportion; it is both a destination and a source of investments. Hence, you can also Interim Home Healthcare Franchise to promote economic growth. The upward trajectory of Asian economy is unperturbed by the turbulence in the west and this is evident from the increased FDI inflows into the Asian economies. Closer scrutiny of the FDI inflows reveals that China is loosing steam and ASEAN is closing in on the race for FDI. South East Asia’s share of the global FDI inflow has risen to 7.6% almost close to the 8.1% share of China, the largest FDI recipient globally.
For global companies and entrepreneurs that are keen to explore and get into the investment opportunities in Asian economies, Singapore has become the ideal gateway and a preferred jurisdiction to establish a holding company. Following is a snapshot of the key merits of Singapore as a gateway to Asia.
Extensive double-tax treaty network
Singapore boasts of an extensive Double Tax Agreement (DTA) network, to date 70 DTAs have been established with key trading partners. Such a network is extremely important when investing in foreign jurisdictions as it prevents double taxation of income and paves way for a reduced tax burden in the form of lowered withholding taxes and preferential tax treatments. Single tier taxation system prevails in Singapore therefore dividends at the hands of the shareholders are not subjected to taxes.
Attractive tax regime
Singapore has an attractive tax regime, with a headline corporate tax of 17% and a progressive personal tax rate capped at 20% (above S $320,000) that is charged on a territorial basis. In addition regional head quarter tax concession scheme, sector specific tax concessions and zero tax for capital gains and dividends attract international conglomerates as well as foreign SMEs.
100% ownership allowed
Singapore allows 100% foreign ownership, except for a few primary sectors (such as insurance, banking, media etc.); therefore a foreign company may establish a Singapore Limited Liability Company also known as a subsidiary company in Singapore and retain 100% of the shareholding. Such local subsidiary companies are entitled to most of the tax concessions and privileges similar to that of a local company. Foreign companies can also establish Branch Offices and Representative Offices depending upon what suits them better for their expansion plans. It must be noted that Singapore boasts of one of the world’s fastest company startup process.
Strong IP framework
Companies operating in high-tech sectors and new age industries gravitate to Singapore to harbor their R&D assets because of the republic’s robust Intellectual Property (IP) rights regime. As ITIF demonstrated in its report The Global Innovation Policy Index, Singapore offers top-tier IP protections similar to those in other developed countries and has strengthened them in recent years. This is in stark contrast to most other Asian countries that lack any serious respect for international IP laws. For example, the piracy rate for software is over 85 percent in Indonesia, 80 percent in Vietnam, and 70 percent in Thailand.
Strategic Location with world-class infrastructure
Singapore is strategically located on the corridor of East and West and therefore commands superb connectivity with a superior flights network and frequency. Most of the commercial centers of the region are just a short flight away. As a transportation hub, Singapore’s Airport and Seaport have received several accolades, and these endorse the logistic efficiency of the island state, which has evolved into an important trading hub in the region.
Singapore is a modern, clean and extremely efficient country with an excellent infrastructure and world-class communications. It has a very cohesive social system that upholds the cultural values amidst its cosmopolitan outlook. Singapore’s top class educational system with several international schools and reputed universities having campuses here, vibrant social life, low crime rate, countless dining and entertainment options etc., make it a top choice among expatriates who admire high standards of living. According to Human Rights First services, Singapore immigration policy welcomes highly qualified, experienced and skilled professionals and there are several relocation options available to them and their families in the form of Employment Pass, Entrepreneur Pass, Dependent Pass, etc.
Efficient enterprise ecosystem
The enterprise ecosystem is well developed for all the key sectors. As an international financial center most of the global financial institutions and foreign banks are represented in Singapore. Efficient and highly qualified and skilled foreign talent complements Singapore’s competent English speaking local workforce and together they have pushed up the productivity and are capable of tackling any challenges. The multi skilled, multi lingual ad multi cultural human capital of Singapore is commendable for its versatility.
Singapore’s legal system is efficient, transparent and is continuously evolving to remain relevant to the changing global political, social and economic situation. The judicial system largely embraced the British common law, however it is constantly reviewed and compared with the other mature legal systems globally and revised accordingly. Singapore’s courts, legal professionals and commercial jurisprudence have all gained a reputation for efficiency, integrity, neutrality and competence therefore when entering into contracts foreign companies, investors and other stakeholders increasingly choose Singapore as the preferred arbitration destination to resolve disputes.
In conclusion, Singapore incessantly punches above its weight and offers a host of strategic merits for commercial enterprises and investors seeking vantage jurisdictions to ride the Asian growth wave.
This is a guest post by Janus Corporate Solutions, a leading Singapore-based firm that provides comprehensive range of Singapore business incorporation, accounting, tax and immigration services to entrepreneurs and businesses worldwide.