(July 20): Singapore is considering cutting taxes for hedge funds and other asset managers and making it easier for them to hire more foreign talent, as rival Hong Kong nears finalisation of widespread tax exemptions, according to people familiar with the matter.

Interactions between the hedge fund industry and the Monetary Authority of Singapore (MAS) have been going on for a few months, and picked up after Hong Kong presented a bill to its Legislative Council in June. The Chinese financial hub intends to introduce a policy to give tax breaks on eligible carried interest for fund managers, as part of a broader push to attract more global firms and executives to the city. 

Singapore authorities are weighing various measures to prevent funds and talent from moving to Hong Kong, said the people familiar, who asked not to be identified sharing private information. One potential direction considered is lowering the standard corporate tax rate of 17% for investment firms, according to the people. Others said that cuts to taxes on the carried interest of individual managers is also under review.

Another key issue that some fund managers have raised to the MAS is easing the path for global talent to live and work in Singapore, according to two people familiar with the private discussions. Their suggestions to the MAS include easing access to visas including the so-called overseas networks and expertise pass, regular employment passes, as well as permanent residence permits, the people said. 

While the MAS did not commit to making changes in these areas, the firms were told that the regulator was looking into potential measures on the immigration issue, the people said. 

The Financial Times earlier reported Singapore’s move to consider lower taxes, among other measures.

“The MAS is reviewing measures to sharpen the competitiveness of Singapore as a trusted and dynamic financial centre to financial institutions and talent,” a MAS spokesperson said in response to queries.