China, India and Emerging Asia Tax Rates Compared

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Complimentary issue of China Briefing examines tax rates across Asia

Dec. 9 – The new December issue of China Briefing has been made available for complimentary download and features a comprehensive overview and comparisons of tax rates across Asia.

Focusing on comparisons of corporate income tax, value-added tax, goods and service tax, standard tax on dividends, and individual income tax in China, India, Vietnam, Hong Kong and Singapore, “The Asia Tax Comparator” also includes data on Bangladesh, Cambodia, Indonesia, Japan, Laos, Malaysia, Mongolia, Nepal, the Philippines, South Korea, Sri Lanka and Thailand.

This issue of China Briefing Magazine includes:

  • A visual look at corporate income tax (CIT), value-added tax (VAT), goods and service tax (GST), individual income tax (IIT), and the standard tax on dividends
  • Individual income tax rate tables
  • Focus on China, Hong Kong, India, Vietnam and Singapore, with a comparison across Asia

Highlights from China include:

  • The CIT rate for companies in China, both foreign and domestic, is 25 percent.
  • The VAT rate for general taxpayers is generally 17 percent, or 13 percent for some goods, while the VAT rate for small-scale taxpayers is 3 percent.
  • Withholding income tax rate for non-tax resident enterprises receiving passive income was reduced to 10 percent.
  • Income from wages and salaries is taxed according to seven progressive rates, ranging from 3 percent to 45 percent.

Highlights from Hong Kong include:

  • Hong Kong adopts a territorial source principle of taxation, which means that only profits sourced in Hong Kong are taxable in Hong Kong.
  • For 2010-2011, the profits tax rate for corporations is 16.5 percent, and the profit tax rate for partnerships and sole traders is 15 percent.
  • VAT is non-existent in Hong Kong. There is also no withholding tax in Hong Kong for profits repatriated back to the overseas parent company.
  • There are two ways of calculating salary tax in Hong Kong for the individual taxpayers who have assessable income from employment: progressive and standard – the final payable income tax is the lower of the two tax liabilities.

Highlights from India include:

  • CIT for domestic companies, including Limited Liability Partnerships, is 30 percent, while foreign companies in India are taxable at 40 percent.
  • There are four tiers of VAT in India, covering 550 items, ranging from 1 percent to 12.5 percent.
  • When Indian companies repatriate dividends to their overseas parent companies, they are subject to 15 percent dividend distribution tax.
  • India imposes different sets of progressive IIT rates depending on gender and age group, with each group having a different exemption amount. These rates range from 10 percent to 30 percent.

Highlights from Singapore include:

  • Singapore’s corporate tax rate is 17 percent, having decreased in previous years in order to attract investment.
  • Singapore imposes a GST, which is a consumption tax levied on the import of goods and supply of goods and services in Singapore at 7 percent.
  • Withholding tax rates range from 10 percent to 17 percent (the prevailing corporate tax rate). For tax based on prevailing corporate rates, non-resident companies can claim a refund for any expenses incurred.
  • Singapore imposes a progressive tax ranging from 0 percent to 20 percent on the individual income of a tax resident.

Highlights from Vietnam include:

  • Vietnam’s standard CIT rate is 25 percent for both domestic and foreign-invested enterprises.
  • There are three VAT rates: 0 percent, 5 percent and the standard rate of 10 percent.
  • The Vietnam government has abolished the tax on profit repatriation for overseas investors. Foreign investors are permitted to remit their profits annually at the end of the financial year.
  • For residents, personal income is taxed according to seven progressive rates ranging from 3 percent to 35 percent. The personal income tax rate for non-residents is a flat rate of 20 percent.

This issue of China Briefing was researched and written by the Asia professional services firm Dezan Shira & Associates. To contact the practice, please email, visit the firm’s web site at or view their brochure here.

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