Asia Pacific needs tax consistency

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Asia Pacific RegionA demand for tax consistency
In today’s rapidly growing Asian market the most requested thing by new companies is consistency regarding taxation, this is according to a study made by Deloitte. Just 4 years ago the biggest emphasis from companies regarding taxation was on the complexity of tax, but according to the study made by Deloitte the biggest concern that new and growing companies in the Asia Pacific region face is the consistency of taxation. According to 85% of respondents in the study, when thinking about investing in the Asia Pacific region tax is high on the agenda but more important than simply the amount of tax or the complexity of tax is the consistency of tax policies and the way in which they are applied.
The reason Asia Pacific struggles with tax consistency
The overall trend in the Asia Pacific region is that tax is becoming more complex and even more unpredictable, if you were to break the region down into two, one being the mature markets such as Japan, Australia and South Korea the other being the up and coming markets such as China and India you would see that there are two versions with the same result happening, in the mature countries tax is becoming more complex in order to better deal with the struggling economies, whilst the newer emerging markets are in a constant battle to keep up with the demands that their economies are throwing them, thus we are seeing the same inconsistent taxation but for two completely different reasons. However some jurisdictions such as Hong Kong and Singapore were singled out as scoring high in regards to tax consistency. Many are concerned that global tax policies and so called tax transparency put in place by bodies such as the OECD will only make taxation in the Asia Pacific region more inconsistent, complex and confusing. Deloitte’s Asia Pacific Regional Managing Director for TaxAlan Tsoi was quoted as saying ‘The principles of tax consistency, complexity and predictability increasingly influence the decision of corporates as to whether they will invest in a market,’ but it is not all doom and gloom as he does see opportunities in the future although he admits that global policies on tax will bring even greater complexity.
Advice on tax in Asia
Singapore is quickly becoming one of the most popular jurisdictions for new companies to be incorporated, this is due to many reasons from its territorial taxation policies to its reputation for being a stable economy in which to invest in, to the fact that it is ideally located as doorway into the strongly emerging Asia Pacific region. If you are considering Singapore as a jurisdiction to start your company or if you would like advice on Singapore taxation, we can defiantly help with more than ten years of experience and a professional team based in Singapore Eltoma Corporate Services has the means and knowhow to deal with all of your corporate requests.