The Labuan International Business and Finance Centre can complement Hong Kong's position as the gateway to China by providing investors with effective legal and tax structures says Danial Mah Abdullah, the Labuan IBFC's Chief Executive Officer.
The Labuan IBFC held the final leg of its ASEAN roadshow in Hong Kong on October 20 to mark the financial center's 25th anniversary.
Abdullah said: "Labuan IBFC has its strengths in terms of its proximity to strategic Asian markets and sound regulatory framework, with simple as well as competitive tax system. With our balanced supervisory and regulatory framework, coupled with our strategic location in the heart of Asia Pacific, we believe Labuan IBFC stands out as the ideal 'midshore' jurisdiction from which to base regional business operations for both trading and investment purposes."
He added that Labuan IBFC can tap into Hong Kong's position as the conduit for investment into China by providing business solutions such as business process outsourcing.
Companies registered in Labuan, an offshore jurisdiction located off the north coast of Malaysia, enjoy considerable tax advantages, including access to a three percent tax on chargeable profits derived by an offshore company from an offshore trading activity. Alternatively, an offshore company that carries on an offshore trading activity may, within three months from the commencement of any calendar year, elect to be subject to a fixed tax instead of MYR20,000 (USD4,600) for that year of assessment. An offshore company that carries on an offshore non-trading activity is exempt from income tax altogether.
The Labuan IBFC reported strong performance across all financial sectors, including banking, insurance, leasing, wealth management, and Islamic finance, last year, reporting 12.3 percent growth in new company registrations in 2014 compared with 2013. More than two-thirds (70 percent) of these new companies originated from Asia, with 57 percent from South East Asia, mainly from Indonesia, Malaysia, Singapore, and Thailand.
Labuan is also becoming a popular jurisdiction in which to locate wealth management vehicles and there was an almost 40 percent increase in the number of foundations established there in 2014 compared to the previous year, with 73 percent of them originating from Asia.
By Courtesy of lowtax.net
