Hong Kong introduced a bill to its Legislative Council in May proposing tax breaks on eligible carried interest and performance bonuses for individual fund managers, prompting the Alternative Investment Management Association to caution the MAS in July that the move would widen the personal tax gap between the two hubs.

Data cited by industry trackers illustrate the shift already under way. Hong Kong’s assets under management climbed 20% in 2025 to a record HKUSD 42.2 trillion, aided by a surge in net fund inflows.

By contrast, hedge fund assets in Singapore rose 37% in 2024 to SUSD 327 billion, even as some global managers reported trimming headcount in the city in favour of expanding their Hong Kong presence.

Rents, visa processing times and waiting lists for international schools in Hong Kong have also improved, factors that industry executives say have helped draw expatriate staff back to the territory after years of pandemic-era restrictions and political uncertainty dented its appeal.

Singapore already offers fund tax exemptions under Sections 13D, 13O, and 13U of its Income Tax Act, primarily aimed at attracting family offices and requiring funds to be managed by Singapore-based managers.

The new measures extend the state’s incentive framework specifically to individual fund managers and traders, mirroring the personal tax relief route Hong Kong has taken.

Analysts said the timing of Wednesday’s announcement, ahead of firm details, was designed to give asset managers early visibility as they weigh where to base new regional operations.

Hong Kong’s competing legislation continues to move through its legislature, with both hubs now expected to finalize their respective tax frameworks within the coming months as the contest for Asia’s fund management business intensifies.