The measures announced in Budget 2024 are broadly focused on addressing bread-and-butter priorities, ranging from cost-of-living-related concerns, the need for the Singapore workforce to reskill and upskill in anticipation of the advent of artificial intelligence and other nascent technologies, and environmental and energy sustainability, the need to also keep pace with international tax developments and other global trends for Singapore to stay relevant and competitive in the new economy.
The key tax measures announced in Budget 2024 relate to the following fields of taxation:
- corporate income tax;
- tax incentives;
- individual income tax; and
- indirect taxes and other measures.
With Budget 2024, the Singapore government says it is taking a decisive step to align its tax system with the global minimum corporate taxation framework under Pillar Two of the OECD Base Erosion and Profit Shifting (BEPS) 2.0 project.
This sends a clear signal that, as with tax transparency through an exchange of information and country-by-country reporting previously, the Singapore tax regime will continue to be consistent with international standards. Even as the scope for tax competition narrows, Singapore is working hard to strengthen its competitiveness and is intensifying efforts to attract and retain quality investments, particularly in key sectors such as semiconductors, artificial intelligence and green technology.
The launch of the refundable investment credit (RIC) scheme, in particular, is a timely and strategic move designed to boost Singapore's appeal to foreign investors and spur multinational enterprises already based in Singapore to expand their business activities and seek new areas of growth in Singapore. Budget 2024, states the Minister, attempts to strike a right balance between maintaining Singapore's competitive edge and adhering to its BEPS 2.0 commitments, against the backdrop of mounting geopolitical risks, climate change, a rapidly aging population and inflationary pressures.
The Budget Statement is available here
Source: IBFD Tax Research Platform News