Slump in Company Registrations in Singapore
Company registration services in Singapore had recorded a slump in new activities recently. Recent economic boom post 2009 Financial Crisis had triggered massive capital and asset relocation to lower tax jurisdiction and thus a spike in companies registration (with parent companies based overseas). Typical explanations and justifications given were such as better infrastructure, connectivity and friendly business environment. Though they are justified, but Singapore was tacitly known to give out lower corporate tax rate compared with peers in the region on the basis (justification) that the Government were trying to attract new investment. In reality, a check with OECD website clearly stated that competition for new investment especially in developed economies, countries are not permitted to compete on the basis of low to non corporate tax rate and neighboring countries in EU would make loud noise if they found out that their neighbors were to give out ‘special tax regime’ to companies.
However, The Straits Journal didn’t notice if there were similar reactions from neighboring countries in South East Asia. However, it is worth noted that Singapore is the only high income country and thus, a more competitive economy, workforce and capable government and businesses running the show around the region.
Recent slump in new companies registration could signal a shift in international trade or economic activities. By 2018, AEOI is expected to kick in, and thus exposing overseas assets and bank accounts in which a ‘transparent’ financial system is expected to help all tax jurisdictions in going after companies, and thus could partly explain the slump in new companies registration and corporate services in Singapore.
The effectiveness of AEOI remains to be seen, however, businesses are of the view that the program could work, and thus could partly explain the neighboring Indonesia’s Tax Authority successes with their Tax Amnesty program which run until early this year.
Taxation is a powerful program and which were used as a tool in the past to entice investment. Going forward, countries and government would have to think creatively as the playing field had been leveled and the more innovative an economy and people is, the more vibrant their economic and social life will be.https://straitsjournal.com/slump-in-company-registrations-in-singapore/https://straitsjournal.com/wp-content/uploads/2017/06/singapore-722x480.jpghttps://straitsjournal.com/wp-content/uploads/2017/06/singapore-500x280.jpgBanking & FinanceAEOI,SingaporeCompany registration services in Singapore had recorded a slump in new activities recently. Recent economic boom post 2009 Financial Crisis had triggered massive capital and asset relocation to lower tax jurisdiction and thus a spike in companies registration (with parent companies based overseas). Typical explanations and justifications given were...escveritas [email protected]comAdministratorThe Straits Journal