Hong Kong Ranked As 14th Most Expensive Place For Business

by Mary Swire, Tax-News.com, Hong Kong

13 December 2001

Of the 31 countries surveyed by the Economist Intelligence Unit (EIU), Hong Kong has been ranked as the 14th most expensive place in the world in which to conduct business, and regionally was placed third behind Japan and Australia.

Although Hong Kong has one of the lowest corporation tax rates it is more expensive to create or do business there than in most other areas in Asia including South Korea, Taiwan, Singapore, Malaysia, India, China, Thailand and Indonesia.

According to the EIU report, the favourable corporation tax rate was offset by the labour costs of workers in Hong Kong which were considered moderate compared to the high executive pay for senior positions. In addition housing costs in the territory were found to be the most expensive of all the 31 places surveyed; office occupancy costs in Hong Kong were the third highest after London and Tokyo at around US$991 per square metre per year.

Overall, the top three countries considered to be the most expensive in the world for businesses are Japan, the United States and Germany (in that order) due to high labour, rents and expatriate costs.

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