Originally posted by Gazelle:
Quote : According to the publication, the
real 'engines' of competitiveness are, however, [b]science,
technology, entrepreneurship, finance, logistics and
education. "A Science Culture plays a central role. In the
end, science, supported by education, is at the core of
competitiveness for a nation."
Taxes still matter as a production cost and are one
of the reasons why companies relocate abroad. "The real impact of
taxes is, thus, on job creation or destruction," underlines the
book. A higher cost of business can, however, be in part
compensated by improving the "ease of doing business". The
simplicity of the tax system seems thus as important as the level
of taxation. "In this regard, a simpler flat tax system may be more
valuable in the long run than a complex low tax regime," indicates
the WCY.
Singapore is still very dependent on manufacturing, while countries
like Australia are not. Therefore it is wrong to say that High
taxes do not hinder competitiveness
[/b]
While you are correct in your views held, the article is a
report from the
World Competitiveness Yearbook had also
indicated that "In the end, science, supported by education, is at
the core of competitiveness for a nation".
Its first statement that it is the quality and efficiency of
expenditures that determines the economic competitiveness of a
country - and such quality expenditures in education certainly is
correct and true to its first premise taken.
It also recognise that "The real impact of taxes is, thus, on job
creation or destruction" - and also to the fact that "A higher cost
of business can be in part compensated by improving the ease of
doing business. The simplicity of the tax system seems thus as
important as the level of taxation - a simpler flat tax system may
be more valuable in the long run than a complex low tax regime "
.
The report also indicated that there is "no clear co-relation
between a country's total tax pressure and its overall
competitiveness or growth rate seems to exist. Despite the high
taxation (above 40 per cent of GDP), Finland, Denmark and
Luxembourg rank among the top ten in competitiveness while Estonia,
Ireland, the Slovak Republic and the US had excellent growth rates
with much lower taxes (25-34 per cent of GDP ) .
Singapore manufacturing sector is largely export oriented which is
supported by a very liberal tax regimes towards costs and revenues
earned.
The impact of high taxes - if any exist - has no direct bearing to
the manufacturing sector in Singapore.
