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10 Best Places To Start A Business According To Corporate Tax Rates

Fizah Hatman
Updated

This article was originally on GET.com at: 10 Best Places To Start A Business According To Corporate Tax Rates

One of the factors that companies in Singapore will look at when they want to expand their business overseas is the corporate tax rates of the particular country. While corporate tax rates do play a big a role in the decision making process, other factors like the level of difficulty to obtain construction permits or property registrations, credit availability, access to electricity and the cost of living will also affect the business decision.

Countries with the lowest personal income tax rates may not necessarily have the lowest corporate tax rates, although that is the case with some countries. You’re probably thinking, aren’t tax havens the best places to set-up a business? Not necessarily. As mentioned before, other factors also come into play when it comes to setting up a business, so bearing in mind these factors as well, we at GET.com, have narrowed down the 10 best places to start a business according to countries with the lowest corporate tax rates in descending order (highest to lowest).

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10. United States

With the highest tax rate of 42% among this list, the U.S. is still one of the most sought after countries by businesses. One of the reasons is the low costs when it comes to operating a business. This means that business resources like offices, supplies and logistics are cheap. On top of that, the U.S. also has a relatively low cost of living.

9. New Zealand

Coming in with the second highest tax rate in this list with a corporate tax rate of 28% is New Zealand. Starting a business in New Zealand is simple and quick because of its online procedure. Its free trade agreements, efficient tax codes and regulations that promote competition, are just some of the reasons why people are starting their business in New Zealand. They also protect minority investors and have an open political system.

8. Norway

Norway comes in third on the list with a 25% corporate tax rate. Other than its low relative cost (0.90% of annual income per capita), the business start-up procedure takes only four days. Norway also has a strong technology sector and a robust workforce that has a secure safety net of social programs that you can fall back on.

7. South Korea

South Korea has a corporate tax rate of 24.2%. This country has a high performance of innovative development and new technologies. South Korea has only recently become more business friendly. They are also resourceful when it comes to having access to electricity, enforcing contracts and also trading across their borders.

6 & 5. Sweden and Denmark

Both Sweden and Denmark have a corporate tax rate of 22%. Despite being the highest in the world for its income tax rates, the Swedes have a high standard of living. This and also the fact that they are the world’s most skilled labour forces, Sweden has been climbing its way to being one of the most business-friendly countries in Europe. They also have a well-developed social program and sturdy infrastructure, which is also attractive to prospective entrepreneurs.

With a corporate tax rate of 22%, setting up a business in Denmark can be as quick as one day because of its effective digitisation process. Apart from being efficient, the cost of starting a company in Denmark can be as low as 670 Kroner, which is an estimated S$138. To trade across the border is also easy in Denmark because of its ‘free border’.

4 & 3. Finland & United Kingdom

Both Finland and the United Kingdom have a corporate tax rate of 20%. The Finnish are known for their innovative ideas and competitive attitude. They are also known to be efficient when it comes to insolvency filings. Finland has been improving in its rankings in the past few years and is now one of the best European countries to start a business in.

The United Kingdom and its corporate tax rate of 20% is home to Europe’s biggest financial centre. The U.K. has been associated with low costs when it comes to setting up a business as well as to entrepreneurial optimism. The start-up cost for a business in the U.K. can cost as low as £81, which is an estimated S$156.

2. Singapore

Singapore has a low corporate tax rate of 17%. We are known to be one of the most business-friendly and secure countries when it comes to starting a business. We are also known for efficiently resolving commercial disputes in court, which takes 150 days on an average. On top of that, the high standard of living is also a contributing factor to why Singapore is one of the top countries that attracts foreign investors.

1. Hong Kong

Even though Hong Kong’s registration fees to start a business are high, their corporate tax rates come in at the lowest percentage of 16.5% in this list. Hong Kong is also one of the countries that protects minority investors greatly and it's also known to be an easy country when it comes to obtaining construction permits.

Money-Saving Tips For Business Owners In Singapore

Despite Singapore being second on this list because of our tax rate, we are still considered as the most business-friendly economy, according to the world bank.

If you’re thinking of starting a business of your own or if you already are a business owner in Singapore, you can check out these 4 tips for business owners to manage cash flow.

We’ve also rounded up the best credit cards for your business that can help you save money by earning rewards and cashback.

What do you think? Share your comments with us below!

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