Thursday, 18 May 2017 14:44

Singapore Budget 2017: Brief Highlights

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Individuals

a) All individual tax residents will receive a personal income tax rebate of 20% of tax payable for income earned in basis year 2016. The rebate will be capped at $500 per taxpayer.

b) Withdrawing the Goods and Services Tax (GST) Tourist Refund Scheme (TRS) for tourists departing by international cruise whose purchase are made on or after 01 July 2017. Tourists departing by international cruise from the cruise terminals will have until 31 August 2017 to claim refunds on purchases made before 01 July 2017. The electronic TRS facilities at the cruise terminals will be removed after 31 August 2017.

Businesses

a) The Corporate tax rate remains unchanged at 17% (excluding any tax exemption).

b) The Corporate Income Tax Rebate cap for 2016 will be raised from $20,000 to $25,000 with the rebate rate unchanged at 50% of tax payable. It will be extended to year 2017 but a reduced rate of20% of tax payable and capped at $10,000 to help companies cope with the economic uncertainty and continue restructuring.

c) Introducing an Intellectual Property (IP) Regime that encourages the exploitation of IP arising from Research and Development (R&D) activities of the tax payer by introducing the IP Development Incentive (IDI). The IDI will take effect on or after 01 July 2017.

d) Introducing a safe harbour rule for payments under Cost Sharing Agreements for R&D Projects

e) Extending the Withholding tax exemption on payments for international telecommunications submarine cable capacity under an Indefeasible Rights of Use agreement from 27 February 2018 until 31 December 2023 to be in line with the Government’s thrust to grow the digital economy and continue to be a key hub for data flow.

f) Enhancing the Global Trader Programme (GTP) to facilitate and encourage more trading activities in Singapore and to simplify the GTP. The GTP will be enhanced for qualifying income derived on or after 21 February 2017 by approved global trading companies from qualifying transactions.

g) Extending and refining the Aircraft Leasing Scheme will be extended till 31 December 2022. The concessionary tax rate on income derived from leasing of aircraft or aircraft engines and qualifying ancillary activities will be streamlined from 5% and 10% to a single rate of 8%.

Financial Sector

a) Extending the Withholding tax exemption on payments made to non-resident non-individuals for structured products offered by Financial Institutions till 31 March 2021 but subject to conditions. This is to continue promoting Singapore as a financial hub.

b) Refining the Finance and Treasury Centre (FTC) Scheme by streamlining qualifying counterparties for certain transactions of approved FTCs. The change will apply to new or renewal incentive awards approved on or after 21 February 2017.
It will help to ease the compliance burden of approved FTCs.

c) Extending the Tax Incentive Schemes for Projects and Infrastructure Finance till 31 December 2022, apart from the remission of stamp duty payable on the instrument of transfer relating to qualifying infrastructure projects / assets to qualifying entities listed, or to be listed, on the Singapore Exchange (SGX) will be allowed to lapse after 31 March 2017