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World Bank report suggests Hong Kong remains one of the best business environments for paying taxes
James Ngai, partner in Russell Bedford Hong Kong, comments on World Bank Paying Taxes survey
The annual World Bank Doing Business report assesses regulations affecting domestic firms in 183 economies, ranking each on the basis of various criteria including ease of starting a business, insolvency resolution, cross-border trade and the ease (or otherwise) of paying taxes. Russell Bedford member firms have contributed to the report’s Paying Taxes survey since 2009, with 51 member and correspondent firms this year contributing data on tax regulation, compliance and the real tax burden on businesses and entrepreneurs.
With Hong Kong ranked in second place in terms of its overall business environment (beaten only by Singapore), this year’s Paying Taxes survey ranks the country in third place for ease of paying taxes. Businesses in Hong Kong are required to make only three separate tax payments per year – the lowest number for any economy in the world. Moreover, they spend an average of only 80 hours per year in doing so – less than half the time spent by businesses in OECD high-income economies (186 hours per year) and significantly below the East Asia and Pacific average of 215.
World Bank analysts attribute this to the fact that only one payment is required in respect of each of the country’s core tax bases – of corporate income tax, employer paid (Mandatory Provident Fund (MPF)) contributions, and property tax. According to the report, “Forty-nine economies have one tax per tax base for taxes measured by Doing Business … This keeps things simple. Having more types of taxes requires more interaction between businesses and tax agencies. It also complicates tax compliance.”
James Ngai, partner in Russell Bedford Hong Kong commented: “It is gratifying to see Hong Kong once again ranked among the world’s easiest tax regimes. One could argue that this proves, yet again, the case for a light regulatory environment in stimulating economic growth – particularly for small and medium-sized businesses.”
For further information, contact James Ngai on +852 2851 0260 or Kempton Bedell-Harper on +44 20 7410 0339. Alternatively, visit the websites at www.russellbedford.com.hk and www.russellbedford.com .
Note to Editors
About Russell Bedford International
Established in 1983, Russell Bedford International is a global network of independent firms of accountants, auditors, tax advisers and business consultants.
Ranked amongst the world's leading accounting and audit networks, Russell Bedford is represented by some 460 partners, 5000 staff and 200 offices in more than 80 countries in Europe, the Americas, the Middle East, Africa and Asia-Pacific.
All Russell Bedford affiliates are well-established firms offering international business advice and services to local and multinational clients. Most provide a full range of services comprising accounting, auditing, tax advice, general business guidance and financial consulting. In addition, many have special expertise in particular fields, such as international taxation or information technology.
In January 2008 Russell Bedford International was named one of the first 17 full members of the IFAC Forum of Firms after reporting it had implemented a globally coordinated quality assurance programme, committed to the use of International Standards on Auditing (ISAs), and met other specific ethics requirements.
Russell Bedford International
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250 City Road, London EC1V 2QQ
T: +44 20 7410 0339
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Global network of accounting and business consultancy firms in key locations around the world. Represented by some 200 offices in more than 70 countries in Europe, the Americas, the Middle East, Africa and Asia-Pacific.