Centralised Entrepreneur/Principal Tax Structures

The last five to ten years have seen significant changes in the business models employed by global groups. In particular, the supply chains today for many, if not most of these global groups, adopt a “centralized entrepreneur/principal” model that looks totally different from a traditional "fully-fledged manufacturer" model that has been widely applied previously. In our experience, taking tax considerations into account from the outset, in designing the new "centralised entrepreneur/principal" model, yields significant permanent and sustained tax savings for the global group.

A key decision, which often has the biggest impact on the reduction in the global effective tax rate, or tax savings achieved, is the location of the "central entrepreneur/principal" company. In this booklet, we layout the key tax considerations for comparing between jurisdictions as locations for the "central entrepreneur/principal" company. We then compare and summarise, against the framework we layout, the key features of selected popular jurisdictions in which global groups generally consider locating their "central entrepreneur/principal" company, including Switzerland, Luxembourg, the Netherlands, Belgium, Ireland, Singapore, and Hong Kong.

Download the sample pages or reach out to your Deloitte Tax professional and Business Model Optimisation team for further discussion.