Singapore is a rapidly growing hub for business in Asia. Many entrepreneurs choose Singapore because of its effective legislation that protects intellectual property while facilitating business ventures.Furthermore, Singapore is favourably located at the centre of the expanding Asia economy. Given the favourable location, businesses benefit from the productive alliances with various huge economies while being to maintain the name of a prestigious and reliable jurisdiction. By executing a fair and competitive tax rates, Singapore has uphold its attributes of being the ideal place for setting up a business. For all these reasons Singapore has taken the forefront over the past decade as a globally recognized business nation.All in all, the main reason behind why Singapore has been so popular with businessmen and corporate entities is that of its cooperate tax policy.Singapore's Corporate TaxIn Singapore, foreign and local companies pay tax equally. This may sound unfavourable at first glance but in fact, Singapore favours its own businesses as it does offshore companies, thus the entrepreneurial culture that exists within Singapore.All income from Singapore are taxed- - income remitted in Singapore or derived in Singapore. The latter means that even if the business is incorporated in Singapore but the transactions is mostly done in other countries the income remitted in other countries will not be taxed. For some practical reasons, businessmen who wants to set up a company in Singapore are advise to seek a professional guidance regarding Singapore tax policy for them to be able to adhere to the tax incentives and policies accordingly.Because of the corporate tax policy of Singapore which address issues and vital needs of incorporation, Singapore has gain a lot of respect from businessmen around the world. The Singapore government has implemented tax exemptions for new companies, in order to facilitate the process of starting and growing a business from scratch. It is vital to take note that most start-up companies encountered several concerns and costs, including registration costs, costs in employment, marketing, building and other aspects necessary to start up a business. Unfortunately, not all countries like Singapore understand the need to provide solutions to alleviate concerns and cost of newly built corporations.In Singapore, there is an exemption of tax for a newly incorporated Singapore for the first annual profit of S$100,000 for the first three years of business. This exemption applies only to companies that are (i) tax residents in Singapore (ii) have 20 shareholders or less (iii) at least 10% of its shareholders are individuals. For companies that do not comply with these criteria, although full tax exemption is not available for the first S$100,000 of profits, partial exemption still applies. Companies that do comply with the full exemption, also benefit from partial tax exemption on the next S$200,000 of profits. It involves a 50% tax exemption on a maximum of S$300,000 of profits for partial exemption and involves S$200,000 of profits for those that benefit from full exemption. This works out to a tax rate of approximately 8.5% on the first S$300,000 of profits, an extremely low rate for an OECD member country.Singapore provides a tax environment that is highly favourable to company setup without causing detriment to the social and economic environment the Singapore government provides for its people. With such low tax rates working effectively in a nation that maintains prestige, efficiency and high quality of life, many may begin to question the need for such high tax rates in other nations. Ultimately, tax benefits, amongst Singapore's many other impressive facets, provides a key selling point for entrepreneurs. No wonder, Singapore has continued to be a vital business location not just in Asia but also worldwide.