Is Singapore still attractive to expats?

According to a Mercer Cost of Living (COL) survey, Singapore (SG) is the fifth most expensive city in Asia, after taking into consideration the costs of housing.
The COL Index for Singapore in March 2007 is 100.4, as compared to an index of 92 a year ago. The base city is New York, USA with a COL Index of 100.
The survey result reveals that it is cheaper for expats to live in the Big Apple (NY) than it is to live in the Tiny Red Dot (SG).

www.mercer.com/costofliving [accessed date: 4 Dec 2007]

On 1 July 2007, Singapore increased its goods and services tax (GST) rate from the current 5% to 7%.

Is Singapore still attractive to the global expatriate workforce even if it is ranked third best in terms of personal tax climate in the region?

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Business Times Singapore, 4 December 2007
Tax climate in S'pore ranked third best in region for expats
By Anna Teo, (c) 2007 Singapore Press Holdings Limited

UAE, Russia, HK are among world's most benign personal tax environments, says Mercer survey

FOR expatriates considering a posting to Asia, the personal tax climate in Singapore is third best in the region, behind Hong Kong and Taiwan. And unlike elsewhere, it makes little difference here whether the taxpayer is single or married, with or without kids.

According to Mercer's survey of 32 'expatriate hotspots', the United Arab Emirates, Russia and Hong Kong are among the world's 'most benign' personal tax environments, while Belgium, Denmark and Hungary are the most onerous.

The findings also show that in general, married employees are better off than single employees tax-wise, and married employees with two children fare the best.

But the difference in tax liability is not too great in a few countries, including Singapore, while employees in China and India pay the same tax regardless of marital status.

Says Guo Xin, deputy regional head of Mercer, Asia: 'Within Asia, Hong Kong and Taiwan have the most gentle tax systems regardless of marital status. The toughest personal tax regimes can be found in India and Australia, with Indians paying more tax than Australians if they are married with two children.'

And through its Central Provident Fund scheme, Singapore has one of the highest social security contributions - second only to Japan - at 11.4 per cent. Social security payments in Hong Kong, for instance, amount to barely 2 per cent.

'If you exclude the mandatory CPF contributions, Singapore's tax rate for middle managers would be 5 per cent, making it the lowest rate in Asia,' Wong Su-Yen, managing director of Mercer Asean notes.

Except for Russia, European countries fill the bottom rungs of the rankings.

Apart from taxation, other key considerations for expatriate allowances are housing, private schooling and local cost of living adjustments - all of which can add up to the high cost of a global expatriate work force.