Saturday 22 November 2014

Singapore named best place in the world to do business for seventh year running: EIU Business environment ranking and index 2014

By Ann Williams, The Straits Times, 20 Nov 2014

The Economist Intelligence Unit (EIU) has once again ranked Singapore as the best place in the world to do business because of its efficient and open economy.

No 2 out of the 82 counries surveyed was Switzerland, followed by Australia, Hong Kong and Sweden respectively.

Singapore has come out tops for seven consecutive years. Last month, it also topped the World Bank's ease of doing business report, which looked at 189 countries.

The rankings were based on the attractiveness of a country's business environment measured by criteria such as political climate, market opportunities, policy towards free enterprise, openness to foreign investment, foreign-trade and exchange controls, taxes, financing, the labour market and infrastructure.

BRIC countries fared poorly on this year's rankings with China in 50th place and Russia in 64th. Brazil and India were ranked 47th and 48th respectively.

EU countries were some way off the top, with the UK at No21 below Malaysia on the annual index.

"The impact of the debt crisis on political stability, economic stability and financing availability has meant that EU countries remain some way off the top," said the EIU report.

However, other northern Europe countries of Denmark and Finland did make it into the top 10, placing eighth and 10th respectively on as they "continue to provide a stable environment to do business".

Said Aengus Collins, European analyst at EIU: "The broader picture that has emerged from the index is that confidence in many countries has taken a battering and recovery will be a slow process."

"Until a few years ago it was widely expected that conditions for business around the world would keep getting better, reflecting the relentless forward march of globalisation. But now the trend of continually improving business environments - underpinned by robust growth, liberal economic reforms and investment in infrastructure - has stalled, in some areas the reverse is happening."

"The future global business landscape will be characterised by lower cross-border capital flows, tighter regulation and less risk-taking."

The top ten in the EIU business environment index:

1. Singapore

2. Switzerland

3. Australia

4. Hong Kong

5. Sweden

6. Canada

7. United States

8. Denmark

9. New Zealand

10. Finland

Singapore 'the 5th easiest place to do taxes'
Republic retains its ranking in global survey on ease of filing, paying taxes for firms
By Chia Yan Min, The Straits Times, 21 Nov 2014

SINGAPORE has kept its ranking as the fifth easiest place in the world for companies to file and pay their taxes, a new study has found.

The study was conducted jointly by professional services firm PricewaterhouseCoopers (PwC) and the World Bank Group.

The report, now in its 10th year, compares tax regimes across 189 economies.

It records the taxes and mandatory contributions that a case study medium-sized company in its second year of business must pay.

In Singapore's case, this includes Central Provident Fund (CPF) employer contributions, as well as corporate tax.

The report also examines the administrative burden of paying taxes and mandatory contributions.

Such a company in Singapore would need 82 hours per year to comply with its tax obligations.

That is very considerably shorter than the global average of 264 hours.

The Singapore company would make five tax payments per year, again much lower than the global average of 25.9.

The total tax rate for the company here - that is, the cost of all taxes borne by the company as a percentage of commercial profits - is estimated at about 18.4 per cent.

The global average is more than double that proportion at 40.9 per cent.

Singapore's "great result" in the ranking "should come as no surprise to small and medium-sized enterprises (SMEs) operating in Singapore, given the Government's focused and principled approach in designing an equitable but nonetheless competitive tax system", said Mr Lennon Lee, a corporate tax partner at PwC Singapore.

Qatar and the United Arab Emirates (UAE) tied for the top spot as countries where it is easiest for firms to file and pay taxes.

Companies in the UAE need a mere 12 hours per year to comply with their tax obligations, while those in Qatar need 41 hours. Firms in both countries make an estimated four tax payments per year.

The two are followed by Saudi Arabia and Hong Kong making up the top five.

While Singapore and the other top-ranking economies may bask in their strong showing, companies in other countries can take heart too.

Paying taxes has become easier for companies around the world, the study showed.

The time and the number of payments required to comply with tax obligations across all economies have fallen over the 10-year period recorded by the survey, as has the average total tax rate.

The fastest rate of decline for the total tax rate occurred during the financial crisis from 2008 to 2010.

The average time it takes a medium-sized company to deal with its tax submissions has fallen by nearly a week and a half over the 10 years of the study, reflecting the increased use of electronic filing and payment systems around the world.

Of the 379 tax reforms recorded in the reports since 2004, 105 relate to electronic filing.

"The latest results from (the) study show many economies are continuing to make progress in tax reform, but there is still a lot of scope to streamline and simplify tax systems," said Mr Andrew Packman, the leader for tax transparency and total tax contribution at PwC.

Policymakers need to find the right balance between raising revenue and ensuring that tax rates and the burden of compliance do not deter participation or discourage business activity, said Mr Augusto Lopez-Claros, the director of the global indicators group at the World Bank Group.


82 hours

Number of hours a firm needs each year to comply with tax obligations in Singapore. The global average is 264 hours.


Number of tax payments a company here would have to make each year, compared with the global average of 25.9


Total tax rate for a company in Singapore.

The global average rate is 40.9 per cent.

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