Canary Islands, potential International Hub
Singapore is considered by the business world to be a safe, thriving and efficient entry point into the Asian Market. Singapore is a gateway to South East and launched the Association of Southeast Asian Nations (ASEAN) Economic Community on 31 December 2015. The island is a hub hrough which some of the world’s largest companies reach across South East Asia by utilising the city-republic’s location, infrastructure, workforce, legal system and business-friendly environment. (1)
In Singapore, the Corporate Income tax rate is a tax collected from companies. Its amount is based on the net income companies obtain while exercising their business activity, normally during one business year. The benchmark we use refers to the highest rate for Corporate Income. Revenues from the Corporate Tax Rate are an important source of income for the government of Singapore. The current Corporate Income Tax is set at 17% and, averaged 20.32% from 1997 until 2018, reaching an all time high of 26% in 1998 and a record low of 17% in 2010. (2)
Moreover, in Singapore the Value-Added Tax or VAT is the Goods and Services Tax or GST and, is a broad-based consumption tax levied on the import of goods (collected by Singapore Customs), as well as nearly all supplies of goods and services. GST exemptions apply to the provision of most financial services, the sale and lease of residential properties, and the importation and local supply of investment precious metals. Goods that are exported and international services are zero-rated. (3)
On February 2018, Finance Minister Heng Swee Keat announced that the GST may be raised by 2% points in the period 2021-2025. The exact timing will depend on three factors: the state of Singapore's economy, how much the country's expenditures grow, and how buoyant Singapore's existing taxes are.The last time GST was raised was more than a decade ago in 2007, when it went up from 5% per cent to 7%.
Singapore is a sovereign city-state and island country in Southeast Asia, as we mentioned before, is the main hub to enter the Asian market. On the other hand, the Canary Islands is not a country, is an autonomous archipelago community of Spain located in the Atlantic Ocean, and are among the outermost regions (OMR) of the European Union proper. It is a region with special consideration from the Spanish government and, it is making enormous efforts to become an International Hub because of its political geolocalization and Corporate Tax Incentives under the European Union framework.
Unfortunately, the Islands are not very well known worldwide, however, are taking relevance under the eyes of potential investors. For example, Canadian companies, British companies, etc. One of the main factories of Japan International Tobacco is based there. Besides the Canary Island special zone, that set the Corporate Tax Rate in 4% there are more Tax Incentives for companies who are looking for setting-up there and advantageous for the profits. As an example we can highlight:
We conclude that the Canary Islands are the next International Hub. We are expert’s advisers of companies looking for setting-up in the Islands. If you require further information, dont hesitate in contacting us.
Novara Capital Group is an international tax & capital investment consulting firm. We specialise in Corporate Structuring, European Union Tax Incentives, IP Positioning, and Transactions / M&A. We provide intelligent corporate structures, advice, and an integrated service which cross delivers in businesses. We advise companies globally to accelerate international growth, optimise net profits, and enhance equity value leveraging Intellectual Property and Licences. Our in-house experts specialise in International Tax Law, Company Law & Cross Border Jurisdiction, Investment & Asset Management, Mergers & Acquisitions, and Operational Management.
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