Hong Kong Friendliest Tax Regime In Asia-pacific

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According to the 2009 Tax Misery and Reform Index, Hong Kong was ranked as the friendliest tax regime in the Asia-Pacific region and the third in the world.

The annual index was done by business magazine, Forbes Asia, by comparing 50 jurisdictions around the world. The score was calculated based on the sum of the corporate, personal, social security and sales tax rates. Tax policies are vital to economic growth because it affects how talent is retained and dictates the flow of capital.

The special administrative region ranked the highest in Asia with a score of 41.5 because of its low corporate tax at 16.5 percent, personal income tax at 15 percent and employer and employee social security levy at 5.0 percent each.

Taiwan followed next as the regions second-most friendly with a score of 75. This year, most Asian jurisdictions continue to have (a) more tax-friendly environment compared with other parts of the world, Forbes said in a press statement.

China and Japan were ranked as having the two harshest tax regimes in the region.

Chinas score increased by seven points to 159 compared to last year because of higher employer and employee social security taxes. China also levied a 25 percent tax on corporate income, 45 percent on personal income, 49 percent for employers social security, 23 percent for employees social security and a 17 percent tax on goods and services.

The rise in employer and employee social security taxes were implemented to aid workers hit by the global slowdown.

Forbes added:The survey shows that outside of China and Japan, the rest of Asia continues to enjoy stable, low tax advantage.

The results of the survey showed that eight of the 10 least tax-friendly countries were in Europe, with France having the least friendly tax regime with a score of 167.9.

The friendliest tax regime in the world can be found in Qatar, which only taxes corporate income. Next is the United Arab Emirates, which taxes social security contributions only.

About the Author:

This article was written for the China Business News website China-Briefing.com. The news site is contributed to by the China tax and law specialists at Dezan Shira & Associates who have been doing business in China for over 20 years.



Article Originally Published On: http://www.articlesnatch.com


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