Are these the Best Countries to Start a Business?
Posted by Adam Solomon on February 9th, 2018.
Before starting a business there are, undoubtedly, a huge number of variables to consider. But one factor that is often neglected is the location of one’s enterprise – and whether setting up shop overseas might yield the secret to success!
Whether it’s low corporate tax rates, access to a skilled workforce, easily-accessible sources of funding or low labour costs – some locations are simply better for starting a business than others.
But where are they?
The United States
Corporate Income Tax Rate: 21%
Number of Days to Start a Business: 6
2018 World Bank Ease of Doing Business Ranking: 6th
US President Donald Trump’s sweeping tax reforms seem set to make America a business-friendly nation once more, with Republicans hoping that the new 21% corporate tax rate will provide fertile soil for budding start-ups.
But beyond tax, what makes the United States a great place to start a business?
America has the most technologically powerful economy in the world, and is recognised for being at the cutting edge of technological innovation. Furthermore, funding for new businesses can come in a variety of forms, including investment firms, banks and angel investors.
US firms also enjoy a greater degree of flexibility compared to those in Western Europe regarding the ability to expand capital, hire and fire staff and develop new products – all with access to a highly skilled, diverse workforce.
South Korea (Republic of Korea)
Corporate Income Tax Rate: 22% (Variable)
Number of Days to Start a Business: 4
2018 World Bank Ease of Doing Business Ranking: 4th
South Korea has demonstrated exceptional economic growth and global integration over the past four decades. This high-tech, industrialised nation has achieved much of this success through the attraction of foreign investment, and by their own contributions to the automobile and technology sectors.
One of the main ways in which South Korea reaps success is by attracting foreign investors. The country boasts low corporate tax rates, easy access to giant Asian trading partners, one of the fastest-growing economies in the world and an efficient and easy business registration process.
In addition to this, foreign investors are welcomed by the passing of the 1998 Foreign Investment Promotion Act, a policy that encourages foreign businesses by offering incentives such as tax relief, cash grants, and financial support.
Denmark
Corporate Income Tax Rate: 24.5%
Number of Days to Start a Business: 3
2018 World Bank Ease of Doing Business Ranking: 3rd
Climbing up the World Bank Group’s ‘Ease of Doing Business’ rankings we have Denmark in 3rd place overall – and top of the list of European countries.
Setting up a business in Denmark consists of a four-step registration process that can be done entirely online in less than a day. Businesses also do not need to be owned and managed by Danish citizens, meaning there are very few restrictions for foreigners looking to set up shop, and (to top it off) many of the legally required registration documents can be completed in English.
Once your business is established you can enjoy the benefits of strong legal rights for borrowers and lenders, simple hiring and firing laws, a highly skilled workforce, a corporate tax rate of 24.5%, low business costs and a flexible labour market.
Singapore
Corporate Income Tax Rate: 17%
Number of Days to Start a Business: 8
2018 World Bank Ease of Doing Business Ranking: 2nd
Singapore is ranked 2nd in the World Bank’s annual ‘Ease of Doing Business’ rankings; an assessment that takes into account variables including registration time and the enforcement of contracts.
With respect to the former, company registration is a breeze – quick, convenient, and distinctly lacking in red tape, whilst the progressive taxation system adheres to a single-tier policy, which means that zero tax schemes are on offer for newly incorporated companies.
When it comes to funding and the productivity of its workforce, Singapore doesn’t disappoint; the small Asian city state is famed for having an abundance of private venture capitalists and a deep pool of world-class workers.
Also notable is the speed by which commercial disputes can be resolved in Singapore’s courts, with a 150 day average being the fastest in the world.
New Zealand
Corporate Income Tax Rate: 28%
Number of Days to Start a Business: 1
2018 World Bank Ease of Doing Business Ranking: 1st
New Zealand takes the top prize in the World Bank’s 2017 ranking, knocking Singapore down to 2nd place thanks to various tax incentives and the streamlined and efficient process by which one can start a business.
Furthermore, New Zealand scored 1st place in rankings for ease of registering property, getting credit, and starting a business, with a 2nd place ranking in taxes, and 3rd place for dealing with construction permits.
Other business-friendly factors include a distinct absence of transaction costs, a broad range of government incentives and grants available, and access to an educated workforce with a diverse set of skills. If that wasn’t enough, New Zealand is famed for its stunning natural landscapes and enviably high quality of living. And with a culture that is decidedly ‘stress free’ when compared to other countries on the list it is little wonder that New Zealand has been catapulted to the top of the World Bank’s list.
Interested in moving to New Zealand? Be sure to check out our Little Introduction to Moving to New Zealand here.
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