Q.3 2022

Data Points

A Selection of AIRINC Research Results

This quarter’s cost of living research was conducted primarily in North America, Central and South America, the Middle East, Africa, and maritime Southeast Asia-Pacific.

Housing Update

Snapshots of expatriate-quality rental markets around the world

United States

Venezuela

Doha, Qatar

Singapore

United States

U.S. rental markets continue to make headlines as many cities experienced high inflation. Broad trends include low supply as rental properties are sold off in hot sales markets while construction lags behind demand. Single-family homes are especially popular, although apartment rents in urban cores are recovering as well. Some of the top movers include Anchorage AK, Los Angeles CA, Miami FL, and New York NY.

Venezuela

Venezuela is battling with staggering but expected inflation. This has filtered down to expatriate rental markets, with rising costs for everything related to property maintenance and upgrades. While the supply of expat housing isn’t necessarily limited, the demand for the best quality and most secured properties has been robust.

Doha, Qatar

Demand for expatriate housing is extremely high. Supply is very low and continues to drop as long-term market leases are transformed into medium- to short-term leases leading up to Soccer World Cup in November.

Singapore

Singapore has seen spiraling rents due to enormous demand from all sectors and job levels. The supply of properties is very limited across the city and the market is very competitive. Sources noted that large rent increases have been slowing slightly but remain significant.

Goods and Services Inflation

Selected locations with inflation higher than 5% for 6 months
Angola
Argentina
Bahamas
Barbados
Botswana
Brazil
Burkina Faso
Burundi
Chad
Chile
Colombia
Costa Rica
Cuba
Djibouti
Egypt
El Salvador
Ethiopia
Fiji
Gambia
Ghana
Guatemala
Guinea
Haiti
Honduras
Indonesia
Iran
Kenya
Lebanon
Lesotho
Liberia
Malawi
Malaysia
Mexico
Mozambique
Namibia
Nicaragua
Nigeria
Paraguay
Puerto Rico
Rwanda
Sao Tome and Principe
Senegal
Sierra Leone
Somalia
South Africa
South Sudan
Sudan
Suriname
Syria
Timor-Leste
Uganda
Venezuela
Zambia
Zimbabwe

Selected 3-month Exchange Rate fluctuations of more than 5%

Zimbabwe

Currency: ZWL

Change vs EUR: -41.8%

Change vs USD: -44.8%

Venezuela

Currency: VES

Change vs EUR: -29.1%

Change vs USD: -32.7%

South Sudan

Currency: SSP

Change vs EUR: -21.6%

Change vs USD: -25.6%

Ghana

Currency: GHS

Change vs EUR: -17.5%

Change vs USD: -21.7%

Suriname

Currency: SRD

Change vs EUR: -14.3%

Change vs USD: -18.8%

Argentina

Currency: ARS

Change vs EUR: -9.5%

Change vs USD: -14.2%

Colombia

Currency: COP

Change vs EUR: -6.8%

Change vs USD: -11.6%

Sierra Leone

Currency: SLL

Change vs EUR: -4.8%

Change vs USD: -9.7%

South Africa

Currency: ZAR

Change vs EUR: -4.2%

Change vs USD: -9.1%

Sudan

Currency: SDG

Change vs EUR: -3.2%

Change vs USD: -8.1%

Philippines

Currency: PHP

Change vs EUR: -1.8%

Change vs USD: -6.8%

Chile

Currency: CLP

Change vs EUR: -1.6%

Change vs USD: -6.7%

Morocco

Currency: MAD

Change vs EUR: -1.6%

Change vs USD: -6.6%

Botswana

Currency: BWP

Change vs EUR: -1.5%

Change vs USD: -6.5%

Sao Tome and Principe

Currency: STN

Change vs EUR: -0.4%

Change vs USD: -5.3%

Saudi Arabia

Currency: SAR

Change vs EUR: 5.1%

Change vs USD: -0.3%

Bahrain

Currency: BHD

Change vs EUR: 5.3%

Change vs USD: 0%

Hong Kong

Currency: HKD

Change vs EUR: 5.4%

Change vs USD: 0%

Jordan

Currency: JOD

Change vs EUR: 5.4%

Change vs USD: 0%

Mozambique

Currency: MZN

Change vs EUR: 5.4%

Change vs USD: 0%

Oman

Currency: OMR

Change vs EUR: 5.5%

Change vs USD: 0%

Tanzania

Currency: TZS

Change vs EUR: 5.6%

Change vs USD: 0%

Guinea

Currency: GNF

Change vs EUR: 5.7%

Change vs USD: 0.3%

Mexico

Currency: MXN

Change vs EUR: 6.1%

Change vs USD: 0.6%

Angola

Currency: AOA

Change vs EUR: 6.4%

Change vs USD: 1%

Papua New Guinea

Currency: PGK

Change vs EUR: 6.7%

Change vs USD: 1.2%

Jamaica

Currency: JMD

Change vs EUR: 7.1%

Change vs USD: 1.7%

Somalia

Currency: SOS

Change vs EUR: 7.3%

Change vs USD: 1.8%

Dominican Republic

Currency: DOP

Change vs EUR: 8.7%

Change vs USD: 3.2%

Algeria

Currency: DZD

Change vs EUR: 9.3%

Change vs USD: 3.8%

Costa Rica

Currency: CRC

Change vs EUR: 13.1%

Change vs USD: 7.2%

Zambia

Currency: ZMW

Change vs EUR: 14.5%

Change vs USD: 8.7%

Country
Tax Update

Changes in expatriate tax

Barbados

China

Germany

Iceland

Iran

North Macedonia

Montenegro

Suriname

Barbados

Barbados introduced a Pandemic Contribution Levy equal to 1% of income exceeding BBD 75,000 annually or BBD 6,250 monthly. The levy is intended to be temporary, applicable for the 12-month period April 1, 2022 to March 31, 2023. The levy is not deductible for regular income tax purposes. The net effect is an increase in tax for higher incomes. Social security is unchanged.

China

China implemented updates to the social security wage base used for calculating the maximum social security contributions and certain contribution rates. The net effect is an increase in social security and a reduction in income tax as social contributions are deductible. As a reminder, the proposed expatriate tax changes were postponed to 2024.  Amounts paid to expatriates as a reimbursement of housing costs, transportation expenses, meals and laundry, language lessons, children’s education, and home leave (supported with receipts of actual costs incurred) are exempt from tax through 2023. Certain qualifying bonus payments paid through 2023 may receive a tax concession, subject to a lower effective tax rate. These tax concessions are scheduled to be eliminated beginning 2024.

Germany

Germany implemented a price-hike relief package to help offset the higher costs of energy prices and other living costs. The legislation was implemented as of May 28, 2022 and is generally effective retroactively as of January 1, 2022. The relief package includes some one-time measures in 2022 to provide relief in view of sharply rising costs for energy consumption, including a taxable lump-sum payment of EUR 300 for all taxpayers in addition to their wage and a bonus of EUR 100 per child in addition to the child benefit. The income tax changes impacting individuals include an increase in the employee expenses deduction from EUR 1,000 to EUR 1,200 as well as an adjustment to the German tax formula increasing the amount of tax-exempt income and adjustments to the tax brackets. The net effect of these changes is a small decrease in tax for most taxpayers.

Iceland

There were adjustments to the State Tax Credit, Elderly Construction Fund tax, Child Benefit, and the National Broadcasting Service tax. The tax rate schedule was changed, with the three rates increasing substantially from 17%, 23.5%, and 31.8%, to 31.45%, 37.95%, 46.25%. Social security is unchanged. The net effect is an increase in income tax for most taxpayers.

Iran

The maximum contribution to social security increased from IRR 158,282,250 to IRR 249,138,050. Family allowances were adjusted from IRR 31,860,000 per child to IRR 50,148,000 per child but limited to a maximum of two children. The tax rate schedule was modified, with brackets increased and the top marginal rate increased from 25% to 30%. The net effect is an increase in social security at higher incomes. The net effect on tax varies by income level, with a decrease in tax for most taxpayers and an increase in tax for higher incomes.

North Macedonia

North Macedonia applied inflation-indexing adjustments to the personal allowance and the social security wage base. The maximum contribution to social security increased from MKD 2,211,740 to MKD 2,339,044, and the personal allowance increased from MKD 101,256 to MKD 105,456. The progressive tax rate schedule was suspended from January 1, 2020 to December 31, 2022, and during this period a flat rate of 10% applies. Beginning 2023, the progressive tax rates with a top marginal tax rate of 18% are scheduled to apply. The net effect is a small decrease in income tax for all taxpayers, and an increase in social security at higher incomes.

Montenegro

Montenegro introduced progressive tax rates assessed on income effective for 2022, replacing the flat 9% tax rate. The new top marginal tax rate is 15%. The health insurance component of social security was abolished. The net effect is a decrease in social security for all taxpayers and an increase in tax for most taxpayers.

Suriname

The temporary COVID-19 solidarity surcharge of 10% on taxable incomes exceeding SRD 150,000 has expired. This reduces the top marginal tax rate from 48% to 38%. The net effect is a decrease in tax for all incomes.

Research Location Update

Q.3 2022 Researched Locations and Upcoming Q.4 2022 Locations

AIRINC researches more than 150 locations each quarter.

Q.3 2022 Researched Locations
Q.4 2022 Upcoming Locations

White Papers & Articles

Mobility Optimization Paper

In this period of transition and reinvention, many companies are reorganizing their Mobility functions to address changes to their business or talent environments. We recently interviewed six Mobility leaders to learn how they are optimizing their Mobility functions. Everyone agreed that an optimized Mobility function is one that adds value to the organization by offering customers the right balance of skillsets and resources.

White Papers & Articles

Developmental Assignments & the Importance of Knowing Your Audience

Many mechanics of a developmental assignment are like that of a traditional expat assignment. Tax equalization, immigration support, and a COLA are commonly provided for both move types. However, developmental assignments target a specific type of employee: emerging talent, typically below age 35, that shows growth potential to the business.

Benchmark Surveys

2022 Mobility Outlook Survey

Global Mobility has emerged from the pandemic as a remarkably different function. After a second year managing travel restrictions, heightened immigration complexity, and remote work consequences, Mobility has honed its compliance skills and is shifting focus to address its next big challenge – helping attract and retain top talent.

White Papers & Articles

2022 Remote Work Playbook

In our first version of this playbook published in 2020, it was not clear if the rise of remote working would continue or only be a temporary pandemic phenomenon. It is now clear that remote work is here to stay.

For More Information

Please contact your Client Services representative for more details and further information.

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