A public consultation on the draft Income Tax (Amendment) Bill 2011 will be conducted by the Ministry of Finance from 11 July 2011 to 1 August 2011.
The proposed amendments to the Income Tax Act (“ITA”) which principally relate to the changes announced in the 2011 Budget Statement are as follows:
- Enhancement of the Productivity and Innovation Credit (“PIC”) Scheme to further encourage pervasive innovation and raise productivity efforts by increasing the amount of tax deductions and improving the PIC qualifying conditions;
- One-off corporate tax rebate of 20% up to $10,000; or SME Cash Grant of up to $5,000 to help companies with rising cost;
- Introduction of the Foreign Tax Credit (“FTC”) Pooling System to allow businesses to pool their tax credits for foreign tax suffered so as to simplify tax compliance and reduce their tax payable on the remitted foreign income;
- Introduction of the Maritime Sector Incentive (“MSI”) to enhance and streamline all existing maritime tax incentives under an umbrella incentive; and
- Changes to personal income tax rate structure for resident individuals.
The Income Tax (Amendment) Bill 2011 also provides for refinements to existing tax policies and tax administration which include the following:
- Taxability of Government Paid Childcare Leave Scheme to deem such payments to self-employed individuals as taxable income; and
- Application of exchange of information (EOI) provisions to EOI agreements, in addition to tax treaties, allowing Singapore greater flexibility to incorporate the internationally-agreed standard for exchange of information upon request for tax purposes in EOI only agreements.
For full details please refer to the MOF website.