The Ministry of Finance is seeking public feedback on 30 proposed legislative amendments under the draft Income Tax (Amendment) Bill 2012. We invite you to comment on the two categories of proposed amendments:
a) Proposed amendments that give effect to policies announced in Budget 2012. The policies had been adopted after debate in Parliament. We would appreciate your feedback on the drafting of the legislative amendments that give effect to these policies. Your feedback will help us improve the draft legislation for clarity and efficient compliance by taxpayers; and
b) Proposed amendments relating to non-Budget changes. We welcome your comments on both the policy and the drafting of the proposed legislative amendmentsProposed amendments relating to non-Budget changes. We welcome your comments on both the policy and the drafting of the proposed legislative amendments relating to these non-Budget changes.
Scope of the Consultation Exercise
2. The draft Income Tax (Amendment) Bill 2012 incorporates 30 proposed legislative amendments to the Income Tax Act, including:
(a) Budget 2012 changes. These are the tax changes announced by Deputy Prime Minister and Minister for Finance, Mr Tharman Shanmugaratnam, in the 2012 Budget Statement. The key Budget tax changes include:
- Provision of one-off SME cash grant capped at $5,000 to help companies offset higher business costs;
- Enhancement to the Productivity and Innovation Credit (“PIC”) Scheme to further encourage pervasive innovation and productivity efforts by providing more and faster cash upfront for investments and easing of some of the PIC qualifying conditions;
- Provision of certainty of non-taxation of gains on disposal of equity investments to facilitate corporate restructuring, minimise compliance costs and enhance Singapore’s attractiveness as a business location; and
- Enhancements to the Earned Income Relief of up to $8,000 and $12,000 for the elderly and handicapped persons respectively so as to encourage them to stay employed.
(b) Non-Budget 2012 changes. The changes to existing tax policies and administration arise from on-going reviews of the income tax system. These refinements include:
- Alignment of tax treatment with the new accounting standards for small entities: small entities may opt to align the tax treatment with the small entities financial reporting standards to ease their compliance burden; and
- Enhancement for CPF Minimum Sum Topping-Up Scheme: The CPF Cash Top-up tax relief will be extended to cash top-ups made under Minimum Sum Topping-Up accounts of parents-in-law and grandparents-in-law.
3. The summary table provides a brief description of the tax changes and explains the amendments to the Income Tax Act. Please refer to the draft Income Tax (Amendment) Bill and its accompanying Explanatory Statement for details.
4. We would appreciate your full support and participation to ensure that the consultation exercise is productive and focused. Respondents are requested to observe these guidelines:
- Please identify yourself as well as the organisation you represent (if any) so that we may follow up with you to clarify any issues, if necessary.
- Be clear and concise in your comments.
- Focus your comments on how the legislative amendments can be better written to make them clearer and to make compliance easier, or on how the tax policies can be improved (for non-Budget income tax changes).
- Use the prescribed template provided to help us understand your feedback better.
- As far as possible, please explain your points with illustrations, examples, data or alternative formulations of the amendments.
5. This draft legislation is released only for the purpose of consultation and should therefore not be used for individual or business decisions as it does not represent the final legislation or regulations. All comments received during the consultation exercise will be reviewed thoroughly and, if accepted, will be incorporated in the Bill for introduction in Parliament.
Period of Consultation
6. The draft Income Tax (Amendment) Bill 2012 is available for public consultation from 24 July 2012 to 13 August 2012.We regret that comments received after 13 August 2012 will not be considered as there would be insufficient time to incorporate them into the final Bill.
7. We encourage all interested participants to submit your comments via our online submission form , which is the easiest and quickest way for your comments to reach us.You can also send us your comments using the prescribed template , through:
a. email to firstname.lastname@example.org ; or
b. fax to 6337 4134; or
c. post to:
Ministry of Finance
100 High Street, #10-01
Attention: Tax Policy Directorate
Summary of Response
8. We will publish a summary of the main comments we receive on the Ministry of Finance's website , together with our responses, by end of September 2012. The identity of respondents will not be disclosed in the summary.
Documents to Download
9. For further reference, please click here to download the relevant documents relating to this public consultation exercise.