The United States is known for being a great place to start a business. But did you know that Singapore is even better? If you intend to try your hand at business but aim to operate in the global market in the long term, you might be better off starting up in Singapore. Here are four reasons why starting a business in Singapore is a better idea than in the US.
Starting a business in Singapore is faster and more streamlined than in the US.
Starting a business in Singapore is a relatively straightforward process. There are just three steps that need to be followed in order to incorporate a company, and the average time to complete the process is one day. In contrast, the process of starting a business in the United States can be much more complex and time-consuming. There are numerous forms and filings that need to be completed, and it takes six days of processing on average to get everything in order. There are fewer requirements for incorporation as well. In fact, the World Bank had a global survey in 2019 for ease of doing business — Singapore and the US appeared in number 2 and 6 respectively. As a result, Singapore is an attractive destination for entrepreneurs who want to set up shop quickly and efficiently.
The tax regime in Singapore is more favorable for businesses than in the US
When it comes to taxes, businesses in Singapore enjoy several advantages over their counterparts in the US. For one, the corporate tax rate in Singapore is just 17%, significantly lower than the US rate of 21% GST and VAT in the US is at 10%, which is three points higher than Singapore’s 7%. In addition, Singapore offers a number of tax breaks and incentives for businesses, including a double tax deduction for international marketing expenses and a deduction for business investment losses. Corporations in Singapore can get a pioneer tax incentive, a development and expansion incentive, and an intellectual property development incentive, apart from specific incentives for various industries. Corporations can also apply for headquarters schemes depending on how big their headquarters are in Singapore and how much they have committed to staying there. Perhaps most importantly, Singapore has a territorial tax system, which means that companies are only taxed on income derived from within Singapore. This is in contrast to the US system, which taxes companies on their worldwide income. As a result, businesses in Singapore can save significant amounts of money on their taxes. This incentivizes entrepreneurs to incorporate in Singapore despite its small landmass and population; you can still profit a lot by operating globally while headquartered there. In addition, there is no tax on dividends and capital gains, thanks to its single-tier taxation system.
There is greater availability of funding and support for start-ups in Singapore
Small businesses are the lifeblood of any economy, and both the US and Singapore know this very well. In the US, there are several grants available to small businesses depending on what industry they’re operating in and what their projects are. There are also aid programs for businesses started by specific kinds of people, such as veterans, women, and minorities. For the most part, funding is more often than not obtained from other corporations and non-profits in the US. On the other hand, the Singapore government has put in place a number of initiatives to support small businesses. For example, it has a program in which the government will co-invest with third-party investors in deep-tech start-ups. It also supports innovative technologies with the Startup SG Tech program, which speeds up commercialization of these technologies. The government also provides a sizable grant for mentorship and starting up to any innovative first-time business owners. There are also many licensed moneylender in Singapore to provide loans to businesses that may not be able to access traditional forms of financing. In addition, a number of grants and tax incentives have been introduced for start-ups. As a result, there is greater availability of funding and support for businesses in Singapore. This is good news for entrepreneurs looking to set up their own business in the Lion City.
Singapore’s environment is better for start-ups
Setting up a business in Singapore is often touted as being easier than in other countries, and there are a number of factors that contribute to this. For one, the city-state is 100% urban, making it easy to find suitable premises for your business. Additionally, Singapore has a multicultural and cosmopolitan society, which makes it easy to find business partners and employees from a variety of backgrounds. The vast majority of Singaporeans are industrious workers with a strong work ethic. Additionally, the workforce is highly trained and professional, making it easy to find skilled employees for your business. Overall, setting up in Singapore can be a very advantageous proposition for businesses due to the ease of doing business and the availability of skilled workers.
The US and Singapore both have their own strengths when it comes to incentivizing businesses to start up. The US has a greater variety of grants and aid programs, while Singapore offers easier business procedures and a more skilled workforce. However, Singapore’s tax system is much more advantageous for businesses, as they are taxed only on income derived from within the country. This results in significant savings for companies that operate globally while headquartered in Singapore. Additionally, there is no tax on dividends or capital gains in Singapore, making it an even more attractive place to do business. As a result of these advantages, it can be said that Singapore is currently the better location for starting up a business than the United States.