Basic economics teaches us that an array of incentives and corporate friendly tax levels in the economy can stimulate foreign and local investment. Singapore, as a very competitive economy in the commercial front of world economy has been very successfully in drawing in a very respectable level of investment. Let us take a look at the main reason why Singapore has now become a hub for investment in today’s corporate world. Corporate taxes play a large part in this.
The Low Headline Tax Rate in Singapore
It goes without saying that the low headline tax rate of 17% is somewhat a magnet for big foreign companies that look to expand their network in this part of the world. The marginal tax rate when you consider the factors of government incentives, depreciation and others is amongst the lowest in rank in the world. So effectively the actual money you pocket out to the government is much lower in comparison to many other countries. Lower taxes mean lower fixed costs and bigger profit margins for new companies who look to invest in Singapore and make their mark, so this very cost-effective headline rate would encourage many business start-ups as well. There are quite a few specialized business advisory companies in Singapore that provide excellent customized solutions and advice to foreign companies looking to come into the country. These companies provide very useful value additional input in the economic situation of the country while giving your company an insight into things like the corporate tax guide .
Know the Legal Framework You’re Investing Your Business In
The corporate friendly legal framework in Singapore means that there is no ambiguity in their law and it is flexible to the ever-changing requirements of the corporate world within the country. Any company looking to thrive must ensure to accustom themselves with the law of the country they are residing in. Misinterpretation of the law can have a very negative impact on your business. Seek expert legal advice from a reliable local source as breaches in the law can have be very bad in terms of the publicity of your company. With mainstream and social media dominant in most of our lives a simple legal blemish can cost you millions as it would stimulate a negative public image amongst the society which would subsequently reduce your profits.
Other Applicable Taxes and Concessions
The Singapore economy has a fool proof method of ensuring that non-residents pay up on their taxes by linking withholding taxes to payments of certain criteria to individuals who are not Singapore citizens. Most businesses invest on foreign soil without knowing these small but crucial details after all these all add up to your costs and eat up on your profit. Do your research, consult with professionals and always take a second opinion.