1. Cyprus tax reforms increase certainty
Cyprus has launched an action plan to increase tax certainty and attractiveness to foreign investors. Currently is takes less than 2 weeks to setup a business in Cyprus and open a bank account however the regulatory environment is complex and uncertain, making it a high-risk destination. The country has one of the lowest costs of doing business and is strategically located. The reforms are designed to improve the environment for investors and increase foreign direct investment.
The most notable reform regards transfer pricing: the Cypriot Government has recently passed legislation to bring it into line with OECD standards. This development will increase transparency and therefore decrease risk of doing business in Cyprus. Previously, no detailed documentation existed on this topic in particular the arms-length principle.
Theodora Charalambous, TP expert at Deloitte, said
“Now that Cyprus has adopted detailed rules, it will provide a solid framework through which taxpayers can document their pricing methods with related parties which can be presented during any future tax audit.”
At 12.5% Cyprus has one of the lowest tax rates in Europe and has Intellectual Property taxation as low as 2.5%.
2. Ireland FDI
Ireland has reported record FDI in the first half of 2022 up 10% on pre-pandemic investment. It is reported that 18,000 jobs were created from 73 new investments and increases on 82 existing projects.
20% of jobs in Ireland are created by FDI. Ireland is an attractive destination for R&D globally due to the current R&D tax credit scheme implemented by the Government. Intel, TikTok and Apple are amongst the global players which have announced an increase or new investment in the region.
According to EY Ireland ranks 9th in the EU for FDI and 4th place in fdi intelligence Cities of the Future ranking.
Ireland is an attractive destination for global companies due to its location in the UK and as an English-speaking country, and various tax credits which favour investment.
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3. How to use grants and partnerships to fund early stage robotic startups
7:30pm TOMORROW Wednesday 13th July: How to use grants and partnerships to fund early stage robotic startups.
This TechCrunch Live webinar presented by JP Morgan will discuss robotics in supply chain – a hot topic which is set to revolutionise warehouses, manufacturing and online shopping. Join free here
The webinar is followed by ‘Pitch Practice’ for early-stage startups, register free here
4. EU Foreign Subsidies Regulation stops Chinese buying spree
The EU has proposed new regulations which requires all companies who receive state aid to notify the EU when the company: acquires another company; bids for public contracts; and if a review is requested. The legislation is to prevent Chinese government funded Chinese companies from profiting in the EU unfairly putting other companies at a disadvantage.
In addition, the EU has stopped state-backed foreign firms from acquiring EU firms with a turnover of more than 500 million Euros as it deems it unfair competition in light of the Chinese buying-spree.
The new laws are protectionist and whilst they may deter other foreign investors however most countries have or are about to implement similar laws such as US and UK.
5. Energy Security Bill
Kwasi Kwarteng introduced the Energy Security Bill into Parliament for its first reading.
The Bill contains 26 measures to reform energy in the UK.
The Government says the Bill will channel £100 billion of private sector investment by 2030 into renewable energy sources.
The recent cost of living crisis and energy prices soaring have some consumers unable to heat their homes or afford food.
This is the first of 11 possible stages and reiterations of the Bill before it receives Royal Assent and is passed into law as an Act of Parliament: there are still 10 more stages until it becomes law.
5. UAE launches NextGenFDI to attract world’s top digital companies
The UAE has launched ‘NextGen FDI,’ a scheme designed to attract tech companies and workers.
Changes have been made to existing visa and company incorporation processes to make processes more efficient.
The UAE has just announced an increase to its corporate tax rate to 9%. Including fees paid in some freezones, foreign companies are re-evaluating the region’s attractiveness.
5. How Europe, India and Africa are incentivizing foreign investment
A new EY report says that Europe, India and Africa offer investment incentives but guidance is needed to capitalise on them.
The report says that global competition for FDI is getting more and more heated and countries vie for incoming investment through a range of incentive schemes from tax credits to grants to deductions.
Evaluating country by country for a business to expand to may be a myopic task but often in-country specialists can make the landscape more transparent with in-depth knowledge of how such programs & schemes are generally applied.
There is a global restructure going on as countries find their niche, and investors follow. For example, London is the number one tech hub globally after San Francisco. If R&D is a part of your strategy, you may want to consider Ireland.
Whereas India with its young skilled workforce is becoming a manufacturing hub with a new lower tax rate of 15% for new manufacturing projects.
If you were starting out in clean technology however, you might consider Tunisia as your next port which offers 50% rebate for companies who invest in cleantech & renewable energy projects.
Wherever you are thinking of expanding, Trade Horizons has probably people on the ground there who can advise on your individual circumstances. Feel free to give the team a call today.