Foreign entrepreneurs want to explore a move to Singapore in order to set up a new business here because of the country's continued commitment to lower tax rates; these rates have fallen from 26% in 2000 to 17% in the coming year.
(PRWEB) March 17, 2009
The Singapore government has lowered several key tax rates in response to the growing financial crisis. A key assumption behind this strategy (often illustrated through the Laffer curve) is that lower tax rates will spur entrepreneurial activity and help the country buffer the economic slowdown. Preliminary data from GuideMeSingapore.com show that the government's move may be having the desired effect with foreign entrepreneurs.
A statistical analysis of the visitors' page traversal paths on GuideMeSingapore.com shows a strong correlation between a user's search for information on recent tax amendments and subsequent visits to site's section dedicated to company registration in Singapore. Furthermore, a comparison of the site traffic in the month before and after the government's announcement shows that the percentage of foreign visitors to 'Setting up a Business' section of the site has jumped from 62% to 84%.
Andrew Chen, the founder of GuideMeSingapore.com provided a possible interpretation of the data as, "Foreign entrepreneurs want to explore a move to Singapore in order to set up a new business here because of the country's continued commitment to lower tax rates; these rates have fallen from 26% in 2000 to 17% in the coming year." This interpretation of the data is bolstered by the nature of inquiries the site has been receiving about the new tax regime and the new tax incentives made available to small and medium enterprises.
Mr. Chen added, "Singapore government's approach is in marked contrast to that of the new US administration's which proposes to increase tax rates for higher income earners. Unlike the US, Singapore has large foreign reserves and has consistently run budget surpluses; these prudent policies enable it to continue its march down the path to lower tax rates even in these difficult times."
The tax reductions were announced last month by Tharman Shanmugaratnam, Minister of Finance on February 17, 2009. Whether the increased entrepreneur interest will translate to increased economic activity is a question for the future.
GuideMeSingapore.com is a Singapore-focused portal that provides comprehensive, accurate and up-to-date information to global business professionals and entrepreneurs about doing business, relocating, and living in Singapore. For further details, visit company website at http://www.GuideMeSingapore.com.