Hong Kong and Singapore introduce new tax incentives for fund managers

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Hong Kong and Singapore intensified their competition for financial investment talent by introducing new tax incentives for fund managers. Hong Kong initiated the trend with a legislative bill intended to offer preferential tax treatment on carried interest to a wider range of alternative investment groups. In response, Singapore’s central bank announced on August 19 a package of measures, including profit-sharing tax exemptions for managers of qualifying funds. Citigroup analysts noted that Hong Kong’s legislative changes served as a structural catalyst for potential capital and talent inflows.

Consequences

If 3 percent of fund managers relocate from mainland China and Singapore to Hong Kong, it would result in an estimated 1,500 new asset management positions. This shift could lead to an additional 150,000 sq ft of office space demand in specific districts and a 2 percent increase in demand for high-end housing.

Sources

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