New Singapore Shares

IMPACT OF NSS & OTHER OFF-BUDGET MEASURES

Impact on Large Corporations

GHI is a large manufacturing company with an industrial factory in Jalan Besar. For YA 2001 and 2002, the company makes taxable profit of $2,000,000 per year. The annual value of the property for the years 2001 and 2002 is $100,000.

• Income tax. Before the introduction of the off-Budget package on 12 Oct 2001, GHI has to pay income tax of $510,000 in YA 2001 and $477,137.50 in YA 2002. With the corporate tax rebate, GHI’s corporate tax payable is reduced by $36,975 in YA 2001 and $23,856.87 in YA 2002.
  

• Property tax. Before the introduction of the off-Budget package on 12 Oct 2001, GHI has to pay property tax of $9,500 in 2001 and $10,000 in 2002. With the property tax rebate, GHI’s property tax payable is reduced to $5,200 in 2001 and $1,400 in 2002.
  

• Petrol Duty and Vehicle Rebate. In addition, the reduction in petrol excise duty from 40% to 35% and the provision for a one-time rebate for cars, taxis, goods vehicles, etc will help GHI keep the transportation costs down.

GHI will enjoy total corporate tax savings of $60,831.87 and total property tax savings of $12,900. The rebates will result in total tax savings of $73,731.87, a 7.32% reduction in the total corporate and property taxes that GHI is required to pay.