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New Jersey Business Lawyer | Business Formation | LLC  Limited Liability Company | IRS Tax | Business Purchase | LLC Lawyer
Some People Overpay the Government...But Certainly Not our clients!
Ronald J. Cappuccio, J.D., LL.M. (Tax)
Counsellor at Law
1800 Chapel Avenue West, Suite 128
Cherry Hill, New Jersey 08002 US
(856) 665-2121   Fax (856) 665-9005
Email: Ron@TaxEsq.Com
 
LLC Lawyer LLC Attorney

If there is any principle of the Constitution that more imperatively calls for attachment than any other, it is the principle of free thought—not free thought for those who agree with us, but freedom for the thought that we hate. . . . We should be eternally vigilant against attempts to check the expressions of opinions that we loathe. Supreme Court Justice Oliver Wendell Holmes

Helping Small and Emerging Businesses become more profitable!

     


  Singapore, New Zealand and
  the U.S. Retain Top Three Spots

If your company is considering exporting, or setting up operations abroad, this may be a good time because it's getting easier to do business internationally -- at least according to the findings of the Doing Business 2008 study done by the World Bank and International Finance Corporation.



According to the recently published report, taxes and reform are two of the biggest issues that affect entrepreneurial activity worldwide. Lower tax rates, simpler systems, and fewer regulations invite development and the World Bank rankings are designed to be an objective way of looking at them.

So where does the United States rank in terms of the taxes that a medium-sized company must pay or withhold annually? Seventy-sixth out of 178 countries surveyed in the fifth annual Doing Business report.

Despite the taxation score, the report puts the U.S. at Number 3 in terms of the overall ease of doing business.

The report, covering 2006 to 2007, surveyed more than 5,000 professionals and business owners in 178 countries. It tracks important business issues such as hiring workers, paying taxes, and enforcing contracts, as well as the time and costs involved in meeting government regulations for start-ups, trade, taxation, and business closures.

The rankings do not account for other factors such as the quality of infrastructure services, macroeconomic policy, proximity to large markets, crime, currency volatility, investor perceptions, and the underlying strength of institutions. (At the bottom of this article is a chart listing the top 10 countries and their rankings in the various categories.)

This year's report focuses on reforms, with the World Bank noting that countries with the most regulatory reform show greater returns on stock investments and have lower unemployment. According to the report, reformers in the past year generally eased requirements for starting a business, strengthened property rights, increased access to credit and eased tax burdens.

The report does not include social issues or variables such as macroeconomic policy, quality of infrastructure, currency volatility, investor perceptions, crime rates and the underlying strength of institutions.

The top ten reforming countries were: Egypt, Croatia, Ghana, FYR Macedonia, Georgia, Colombia, Saudi Arabia, Kenya, China, and Bulgaria.

Egypt grabbed the top reform spot by:

  • Cutting the minimum capital required to start a business, from 50,000 Egyptian pounds to just 1,000 and halved the time and cost of start-up.

  • Reducing fees for registering property from three per cent of the property value to a low, fixed amount.

  • Easing the process for obtaining construction permits.

  • Launching one-stop shops for traders at ports, cutting the time to import and export.

  • Establishing a new private bureau to make it easier to get credit.

Below is an overview of the rankings in four of the report's categories. The top five listings go from first to fifth and the bottom five go from worst to better. (Click here for the report, as well as access to the World Bank's extensive free on line collection of business laws and regulations.)

PAYING TAXES

Taxes are never popular but the report notes, there are good and bad ways to collect taxes.

The tax category examines the effective tax a company must pay and the administrative costs of doing so. Researchers asked accountants in the 178 countries in the report to review the financial statements and a list of transactions of a hypothetical standardized business that started with the same financial position in every country. The survey asked for the total tax the business had to pay and the processes involved.

 Top 5

Bottom 5

Maldives

Belarus

Singapore

Ukraine

Hong Kong

Republic of Congo

United Arab Emirates

Central African Republic

Oman

Venezuela

Taxes and contributions were measured at all levels of government and include corporate income tax, turnover tax, all labor contributions -- including mandatory contributions paid to private pension or insurance funds -- property and property transfer taxes, dividend tax, capital gains tax, financial transactions tax, vehicle tax and such small levies as fuel tax, stamp duty and local taxes. A range of deductions and exemptions were also taken into account.

The report used three indicators:

1. The number of tax payments, which takes into account the method of payment or withholding, the frequency of payment or withholding,  and the number of agencies involved.

2. Time, which measures the annual hours required to prepare, file and pay corporate income tax, value added or sales tax and labor taxes.

3. The total tax rate, which measures the amount of taxes payable during the second year of operation expressed as a percentage of commercial profit.
STARTING A BUSINESS

This category is based on the procedures a small to medium-sized company must complete to start operating legally. This includes obtaining necessary permits and licenses and completing required inscriptions, verifications and notifications with authorities. The time and cost required

Top 5

Bottom 5

Australia

Guinea-Bissau

Canada

Chad

New Zealand

Tonga

United States

Yemen

Ireland

Eritrea

to complete procedures under normal circumstances are calculated, as well as the minimum capital needed.

To make the data comparable across economies, researchers assumed that the company:

  • Was a limited liability company (LLC) conducting general commercial activities in the largest business city.
  • Was 100 percent domestically owned, with start-up capital of 10 times income per capita, turnover of at least 100 times income per capita and between 10 and 50 employees.
  • Did not qualify for any special benefits or own real estate.
  • Had founders complete all procedures themselves unless the country's laws required using professionals.

DEALING WITH LICENSES

This category researched the regulations to obtain licenses required to operate a business. The study focused on the construction sector, where pressures from government and customers usually result in a trade off between protecting people (workers, tenants, passersby) and keeping the building cost affordable.

Top 5

Bottom 5

St. Vincent/
Grenadines

Eritrea

New Zealand

Russia

Belize

Liberia

Marshall Islands

China

Singapore

Ukraine

Researchers examined the required procedures to build a warehouse, including submitting project documents, obtaining licenses and permits, completing notifications; undergoing inspections, and obtaining utility connections such as electricity, telephone, water and sewerage.

The time and cost to complete procedures under normal circumstances were calculated and the survey included official fees associated.

To make the data comparable across economies, researchers assumed that the business was a small to medium-size LLC, located in the most populous city, domestically owned and operated, in the construction industry, with 20 qualified employees. The warehouse to be built:

  • Was new construction on vacant land.
  • Had complete architectural and technical plans prepared by a licensed architect.
  • Would be connected to electricity, water, sewerage and one land phone line.
  • Would be used for general storage and not for goods requiring special conditions, such as food, chemicals or pharmaceuticals.
  • Would take 30 weeks to construct (excluding administrative and regulatory delays).

OBTAINING CREDIT

The survey measured two sets of issues -- credit information registries and the effectiveness of collateral and bankruptcy laws in lending. Here are the main indicators:

Top 5

Bottom 5

U.K.

Afghanistan

Hong Kong

Cambodia

New Zealand

Madagascar

Australia

Burundi

Germany

Timor-Leste

  • A Legal Rights Index, which measures the degree to which collateral and bankruptcy laws facilitate lending, measuring 10 aspects of the rights of borrowers and creditors in collateral and bankruptcy laws.
  • A Depth of Credit Information Index, which measures the extent to which the rules of a credit information system facilitate lending based on the scope of information distributed, the ease of access to information and the quality of information.
  • Credit coverage, which reports the number of individuals and firms covered by a public credit registry and a private credit bureau as a percentage of the adult population.

Top 10 Countries

 

Singapore

New Zealand

U.S.

Hong Kong

Denmark

Ease of Doing Business

 1

 2

 3

 4

 5

Starting a Business

9

 3

 4

 13

 18

Dealing with Licenses

5

2

24

60

6

Employing Workers

1

13

 1

23

10

Registering Property

13

 1

10

58

58

Getting Credit

 7

 3

 7

 2

 2

Protecting Investors

 2

 1

 5

 3

 19

Paying Taxes

 2

9

76

3

 13

Trading Across Borders

 1

16

15

 3

 2

Enforcing Contracts

4

13

 8

1

30

Closing a Business

 2

16

18

15

7

 

U.K.

Canada

Ireland

Australia

Iceland

Ease of Doing Business

 6

 7

 8

  9

10

Starting a Business

 6

2

 5

1

 14

Dealing with Licenses

54

 26

20

52

23

Employing Workers

21

19

 37

8

42

Registering Property

19

28

79

 27

8

Getting Credit

 1

7

 7

3

 13

Protecting Investors

 9

5

5

51

 64

Paying Taxes

12

25

6

41

 27

Trading Across Borders

27

39

20

34

11

Enforcing Contracts

24

 43

 39

11

4

Closing a Business

10

4

6

14

 12



If you want to establish a new business in the U.S., call Ronald J. Cappuccio, J.D., LL.M.(Tax) at (856) 665-2121 or Email: Ron@TaxEsq.com















Ronald J. Cappuccio, J.D., LL.M.(Tax)
, a LLC Lawyer and Business and Tax Attorney.  We can help you start a Limited Liability Company ( LLC ) which can be the best form of business organization, as well as establish Corporations, S Corporations, Partnerships, Limited Partnerships and Non-Profit organizations. We also can represent you in Buying and Selling a business. helping emphasizing Personal and Business IRS Tax Negotiation,
Offers In Compromise, and Installment Agreements. Zealous representation in Tax Audits, Delinquent Tax, and Tax Collections Issues. Experience fighting Employee and Independent Contractor issues, Payroll Taxes, Tax Liens,and Tax and Labor Audits. Successfully handle Wage Levy Release, Bank Levies and Seizures.  NJ Tax Court, US Tax and US Court of Federal Claims representation. 
                
We also can represent you in Buying and Selling a business.