Doing Business, 2010

Tags: Doing Business, Business database, Israel, Business report, Quartiles, Starting a Business, Aaron Institute, economies, Israel Electric Corporation, social security, electricity connection, paying taxes, external works, social security contributions, business environment, property rights, tax rate, OECD, tax revenue, corporate income tax rate, corporate income tax, profit tax, Human development index, Business indicators, Global Indicators Group Doing Business, total tax rate, property value
Content: Doing Business 2016 Development Economics Vice Presidency Augusto Lopez-Claros, Director, Global Indicators Group Doing Business in Israel: An International Perspective The Aaron Institute for Economic Policy annual conference June 20,2016
I. About the Doing Business report II. Findings of the research III. Israel in Doing Business 2016
What does Doing Business measure? Doing Business indicators: Focus on regulations relevant to the life cycle of a small to medium-sized domestic business. Are built on standardized case scenarios. Are measured for the most populous city in each country, and the second largest business city in countries with more than 100 million inhabitants. Are focused on the formal sector. DO NOT measure all aspects of the business environment such as security, macroeconomic stability, prevalence of bribery and corruption, level of training and skills of the labor force, proximity to markets, regulations specific to foreign investment or the state of the financial system. 2
The 11 areas of business regulation measured by Doing Business affect firms throughout their life cycle
At start-up · Starting a business · Labor market regulation New
When things go wrong · Enforcing contracts New · Resolving insolvency
In daily operations
· Paying taxes
· Trading across
borders
New
In getting a location · Dealing with construction permits New Ne·w Getting electricity · Registering property New
In getting financing · Getting credit · Protecting minority investors
3
Legal sources of information for the Doing Business indicators · Civil Code: property rights, contractual obligations, pledge regimes. · Commercial Code: company creation procedures, minimum paid-in capital requirements, shareholder rights, winding-up provisions. · Tax Code: applicable taxes and contributions. · Secured Transactions Law: creation and publicity of security interest, collateral regime. · Civil Procedure Code: litigation and courts system, judicial enforcement of a commercial dispute. · Insolvency Law: bankruptcy, insolvency, reorganization and liquidation procedures, priority rules. · Labor Code: hiring and redundancy of workers, definition of working hours. The Doing Business Law Library is the largest free online collection of business laws and regulations. More than 3,926 business regulatory references can be found at: http://www.doingbusiness.org/law-library 4
Time and motion indicators focus on the process Example: The complexity and time it takes to register property varies significantly among economies Time and motion indicators Follow the entrepreneur from the beginning to the end of a basic transaction and measure procedural efficiency of the regulatory process by recording every step of the process and the associated time and cost. They also gather all the relevant laws, regulations, decrees and fee schedules. Income per capita in Belgium: US$ 47,030 · Registering property in Belgium requires 8 procedures, takes 56 days and costs 12.7% of the property value. · Meanwhile, Belgium scores 23 out of 30 points on the quality of the land administration index. Source: Doing Business database. 5
Time and motion indicators focus on the process Example: The complexity and time it takes to register property varies significantly among economies
· Registering property in Rwanda requires 3 procedures, takes 32 days and costs 0.1% of the property value. · Meanwhile, Rwanda scores 25 out of 30 points on the quality of the land administration index. 6
Income per capita in Rwanda: US$ 650 Source: Doing Business database.
I. About the Doing Business report II. Findings of the research III. Israel in Doing Business 2016
Strong convergence across economies since 2005 Average by region
116 120 100 80 60 40 20 29 0 250 234 200 150 100 50 0 41
Time to start a business (days)
Time to prepare, file and pay taxes (hours)
800 694 700
600
491
500
40
400
300
200
100 211
194
15
0
Best 3 Quartiles
Worst Quartile
Time to register property (days)
Best 3 Quartiles
Worst Quartile
Time to deal with construction permits (days)
400 339 350
300
250
223
93
200
150
100 158
137
50
32
0
Best 3 Quartiles
Worst Quartile
8 Source: Doing Business database.
Best 3 Quartiles
Worst Quartile
Reforms making it easier to start a business show results over time in reduced delays 2005 It was possible to start a business in less than 20 days in only 41 economies*, mostly in North America and Northern and Central Europe. In the OECD high-income region, entrepreneurs in only 17 economies could incorporate a company in under 20 days. 2015 Now, the time to start a business is less than 20 days for entrepreneurs in 132 economies* worldwide. In the OECD high-income region, 30 out of 32 economies have lowered time to start a business to below 20 days. Development impact: Countries that regulate entry more heavily have greater corruption and larger unofficial economies, but not better quality of public or private goods. (Djankov, La Porta, Lopez de Silanes, Shleifer, February 2002, Quarterly Journal of Economics.) Note: Based on samples of 174 economies in Doing Business 2006 and 189 economies in Doing Business 2016. 9
Top 50 performers in Doing Business 2016
Rank
Economy
1
Singapore
2
New Zealand
3
Denmark
4
Korea, Rep.
5
Hong Kong SAR, China
6
United Kingdom
7
United States
8
Sweden
9
Norway
10
Finland
11
Taiwan, China
12
Macedonia, FYR
13
Australia
14
Canada
15
Germany
16
Estonia
17
Ireland
18
Malaysia
19
Iceland
20
Lithuania
21
Austria
22
Latvia
23
Portugal
24
Georgia
25
Poland
10 Source: Doing Business database.
DTF score 87.34 86.79 84.40 83.88 83.67 82.46 82.15 81.72 81.61 81.05 80.55 80.18 80.08 80.07 79.87 79.49 79.15 79.13 78.93 78.88 78.38 78.06 77.57 77.45 76.45
Rank 26 27 28 29 29 31 32 33 34 35 36 37 38 38 40 41 42 43 44 45 46 47 48 49 50
Economy Switzerland France Netherlands Slovak Republic Slovenia United Arab Emirates Mauritius Spain Japan Armenia Czech Republic Romania Bulgaria Mexico Croatia Kazakhstan Hungary Belgium Belarus Italy Montenegro Cyprus Chile Thailand Peru
DTF score 76.04 75.96 75.94 75.62 75.62 75.10 75.05 74.86 74.72 74.22 73.95 73.78 73.72 73.72 72.71 72.68 72.57 72.50 72.33 72.07 71.85 71.78 71.49 71.42 71.33
I. About the Doing Business report II. Findings of the research III. Israel in Doing Business 2016
Israel scores close to the frontier on the Starting a Business and Trading Across Borders indicators
100
90
80
70
Israel scored
60
70.56 points in
DTF in Doing
50
Business 2016,
40
giving it a ranking
of 53rd overall.
30
20
10
0
12
Source: Doing Business database.
Results on individual indicators
Starting a Business
Trading Across Borders
Protecting Minority Investors
Resolving Insolvency
Paying Taxes
Getting Electricity
Dealing with Construction Permits
Getting Credit
Enforcing Contracts
Registering Property
0
20 40 60 80 100
DTF score
Israel currently ranks 53rd overall on the ease of doing business Rankings on Doing Business topics ­ Israel (Scale: Rank 189 center, Rank 1 outer edge) Source: Doing Business database. 13
Strengths in Israel's business regulations and opportunities to improve
Extent of conflict of interest regulation index (0-10) Total number of tax payments per year (number)
Israel offers better protection of shareholders from conflicts of interest...
9 [VALUE]
8
2 points higher than
7
the regional average
[VALUE]
6
5
4
3
2
1
0
Israel
OECD high-income
14
Source: Doing Business database.
...but requires more tax payments.
[VALUE]
35
payments
30
25
Almost three
times the
regional average
20
15
[VALUE]
payments
10
5
0
Israel
OECD high-income
How has Israel improved its business environment in recent years? Starting a Business: Reduced the time required for registration at the Income Tax Department and the National Insurance Institute in 2012/13. Registering Property: Shortened time limits for tax authorities to process capital gains self-assessments on property transfers in 2011/12. Trading Across Borders: Expanded its electronic data interchange system and developed a single-window framework, allowing easier assembly of documents required by different authorities and reducing the time to trade in 2009/10. Resolving Insolvency: Passed an amendment to its company law allowing the assumption or rejection of executory contracts and granting maximum priority to post-commencement credit in 2012/13 and amended its courts law to establish specialized courts for dealing with economic matters in 2010/11. 15
Israel can improve the process of registering property by reducing the property transfer tax rate
Israel ranks 127th on the ease of registering property.
Registering Property
Estonia
Procedures (number)
3
Time (days)
17.5
Cost (% of property value)
0.5
Quality of the land administration index (0-30)
27.5
Poland 6 33 0.3 18.5
OECD highincome regional average 4.7 21.8 4.2 22.7
Israel 6 81 8.3 14.0
Rank
4
41
43
127
Source: Doing Business database.
How can Israel improve the process of registering property? Set time limits for various procedures · The Russian Federation, for example, has successfully reduced the time to transfer a property by passing a new law to set up effective time limits for the property transfer procedures. Digitize all or part of the process · Poland made transferring property easier by introducing online procedures and reducing notary fees. Reduce taxes or fees · Spain made transferring property easier by reducing the property transfer tax rate.
16
Israel can improve the process of dealing with construction permits by introducing an online system for obtaining a building permit
Israel ranks 96th on the ease of dealing with construction permits.
Dealing with Construction Permits Procedures (number) Time (days) Cost (% of warehouse value) Building quality control index (0-15)
Sweden 7 116 2.2 10.0
OECD highincome regional average 12.4 152.1 1.7 11.4
Netherlands 13 161 3.7 10.0
Israel 15 209 1.6 11.0
Rank
19
48
85
96
Source: Doing Business database. How can Israel improve the process of dealing with construction permits? Implement an online system for obtaining a building permit · The successful implementation of an online system begins with a mapping exercise, designed to identify all steps involved in the process of obtaining a permit. Then, all steps can be transferred to an online system. Require the review by a licensed engineer or architect of the building plans submitted for a permit · Countries such as the United Kingdom and Australia, which have successfully implemented this good practice, require a private firm to review the plans submitted for a permit and take full responsibility in the event of future faults. Implement a risk-based system for inspections · Since not all buildings present the same risks, Israel could greatly benefit from implementing a system for conducting inspections that is based on a risk-assessment. This allows for more detailed inspections of complex environments.
17
Israel can improve the process of getting electricity by reducing the time length to complete the external works
Israel ranks 91st on the ease of getting electricity.
Getting Electricity Procedures (number) Time (days) Cost (% of income per capita)
Slovenia 5 38 113.2
OECD highincome regional average 4.8 77.7 65.1
Lithuania 6 95 52.8
Israel 6 102 11.6
Reliability of supply and transparency of tariff index (0-8)
6.0
7.2
8.0
5.0
Rank
35
37
54
91
Source: Doing Business database.
How can Israel improve the process of getting electricity? Eliminate the internal wiring inspection carried out by the Israel Electric Corporation (IEC) · The utility in Delhi, India, made the process for getting an electricity connection simpler and faster by eliminating the internal wiring inspection carried out by the Electrical Inspectorate. Reduce the time necessary to complete the external works by the Israel Electric Corporation (IEC) · It currently takes 60 calendar days to await completion of external works by Israel Electric Corporation. · The utility in Lithuania has reduced the time of the connection works by enforcing the legal time limit to perform the external connection works.
18
Israel can improve the process of paying taxes by encouraging the usage of online portals for VAT and Social Security contributions
Paying Taxes
Israel ranks 103rd on the ease of paying taxes.
Payments (number per year) Time (hours per year) Total tax rate (% of profit) Profit tax (% of profit)
Ireland 9.0 82 25.9 12.4
OECD highincome regional average 11.1 176.6 41.2 14.9
Spain 9.0 158 50.0 13.3
Israel 33.0 235 30.6 23.6
Labor tax and contributions (% of profit)
12.1
24.1
35.9
5.6
Other taxes (% of profit)
1.4
1.7
0.8
1.4
Rank
6
52
60
103
How can Israel improve the process of paying taxes?
Source: Doing Business database.
Introduce incentives to encourage the usage of online platforms for filing and paying VAT and social security
contributions
· Doing Business does not yet count the online filing systems for VAT and social security contributions because the
majority of business entrepreneurs do not use these electronic portals.
· If the majority of business entrepreneurs used online platforms, the total number of payments for Israel would
drop from 33 to 11.
· In 2015, Poland, the Slovak Republic and Spain were among the economies that introduced or enhanced online
systems for filing and paying taxes.
Give companies the option of paying the municipal tax once a year rather than by installments every 2 months
· This would reduce number of municipal tax payments from 6 to 2.
19
The high number of tax payments in Israel is linked to the scarce usage of online platforms for filing VAT and social security
By encouraging businesses to use online 100 platforms to file and pay VAT and social security contributions, Israel's total number of payments 90
would decrease from 33 to 11.
80 +12
70 Israel's DTF score on the ease of paying 60 taxes would increase from 71.65 to 83.87. All else being equal, Israel's ranking on the 50
ease of paying taxes would increase from 40
103rd to 34th.
30
All else being equal, Israel's overall ranking
on the ease of doing business would increase 20
Israel could improve its Paying Taxes DTF score from 71.65 to 83.87 by promoting online platforms for VAT and social security contributions.
from 53rd to 47th.
10
0
Source: Doing Business database.
20
In recent years, Israel made paying taxes more costly
Payments (number per year) Time (hours per year) Total tax rate (% of profit)
250
31
30.6
200
150
29.2
100
28.9
50
30.5
· In 2014/15, Israel made
paying taxes more costly
for companies by
30
increasing the corporate
income tax rate, the rate
29.5
for social security
contributions paid by
29
employers for the upper
wage bracket and
municipal taxes. 28.5
0 2013
2014
28 2015
Payments (number per year) Time (hours per year)
· In 2013/14, Israel made paying taxes more costly by increasing the profit tax rate.
Total tax rate (% profit)
Source: Doing Business database.
21
Israel is among the economies with a total tax rate below the regional average
60
Total tax rate (% of profit)
50 OECD high-income [SERIES NAME] 40
30
20
10 49.1 0 Sweden
41.0 Portugal
39.5 Norway
34.3 New Zealand
30.6 Israel
28.8 Switzerland
18.4 Singapore
Source: Doing Business database. Israel has the 8th lowest total tax rate among OECD high-income economies.
22
Higher tax rates do not always lead to higher tax revenue or better welfare
Total tax rate (% of profit) Tax revenue (% of GDP) human development index (score 0-1)
Human development index (HDI) Total tax rate (% of profit) Tax revenue (% of GDP)
50
45
40
35
30
25.9
25
20
22.5
15
10
5
0 Ireland
30.6 21.9 Israel
High human development
47.0
1.0
40.3
40.2
0.8
28.9 0.6
0.4
19.1
18.6
15.9
15.1
0.2
Chile
Poland
Russian Moldova Federation
0.0 Low human development
Source: Doing Business 2016, World Development Indicators (WDI) database, Human Development Report (HDR) 2014. Note: Data on tax revenues from the WDI database refer to calendar year 2012. Data on Human Development Index (HDI) refer to calendar year 2013.
23
OECD high-income economies have reduced the total tax rate paid by businesses by nearly 5% of their profits between 2004 and 2014
Total tax rate in 2014 75
Reduction since 2004
Average total tax rate (% of profit)
60
[VALUE]
45
[VALUE]
[VALUE]
[VALUE]
[VALUE]
[VALUE]
30
15
34.6
34.7
36.6
38.9
42.3
46.9
[VALUE] 47.9
0 Middle East & North Africa
East Asia & Pacific
Europe & Central Asia
South Asia
OECD high- Sub-Saharan Latin America &
income
Africa
Caribbean
Development impact: Higher tax rates are associated with fewer formal businesses and lower private investment. A 10 percentage point increase in the effective corporate income tax rate is associated with a reduction in the ratio of investment to GDP of up to 2 percentage points and a decrease in the business entry rate of about 1 percentage point. (Djankov, Ganser, McLiesh, Ramalho and Shleifer, 2010, "The Effect of Corporate Taxes on Investment and Entrepreneurship", American Economic Journal: Macroeconomics.) Note: This figure is based on samples of 174 economies in both Doing Business 2006 and Doing Business 2016. Total tax rate includes profit tax, labor taxes and social contributions, consumption taxes and other taxes borne by businesses.
24
THANK YOU!
Questions
www.doingbusiness.org
Doing Business

File: doing-business-2010.pdf
Title: PowerPoint Presentation
Author: Robert Palmer Wright
Published: Sun Jun 19 13:08:07 2016
Pages: 26
File size: 1.01 Mb


, pages, 0 Mb

MYSTERY READERS JOURNAL, 32 pages, 0.55 Mb

, pages, 0 Mb

The Mission, 1 pages, 0.87 Mb
Copyright © 2018 doc.uments.com