|
1. A public consultation exercise on the draft Stamp
Duties (Amendment) Bill 2005 was held from 8 July to
5 August 2005 to obtain feedback on areas of the draft
legislation that require greater clarity or could be
modified to facilitate compliance by companies and taxpayers.
2. The draft Stamp Duties (Amendment) Bill 2005 put
up for consultation incorporates the announcement made
by Prime Minister and Minister for Finance Lee Hsien
Loong in his Budget
2005 Statement to expand the scope of relief from
ad valorem stamp duties to include transfer of mortgages,
when companies enter into restructuring or merger exercises.
3. The Bill has also included changes brought about
by recent amendments to the Companies Act, introduction
of the Business Trusts Act and reviews of the Stamp
Duties Act. The summary
table lists all the tax changes and explains the
amendments to the Stamp Duties Act.
4. A total of five comments were received from three
respondents. One comment was given by an individual
while the remaining four comments were given by two
professional organizations.
5. Two of the comments received were related to the
drafting of the Stamp Duties (Amendment) Bill 2005 and
we have accepted one of them. The comments and our responses
to them, are summarised in the following table. The
remaining three comments were policy-related and MOF
will take them into account when we review our policies.
| 1. To
expand the scope of relief from ad valorem stamp
duties provided under Section 15 of the Stamp Duties
Act to (a) Business Trusts and (b) Transfer of Mortgages |
It
was highlighted that the legislation is not clear
on how the relief would be provided for the transfer,
conveyance or assignment of assets between a company
and an associated business trust. In addition, it
was suggested that the legislation define how a
company would be treated as being associated with
a business trust.
MOF’s response: Accepted. MOF will work
with IRAS and AGC to improve the clarity of how
Section 15 would be applied to business trusts and
the scenario under which a company and business
trust may be regarded as being associated.
|
| 2. To
require companies amalgamating under the new section
215 of the Companies Act to pay ad valorem stamp
duties |
One
respondent suggested defining the word “value”
in the new section 32C(3) to avoid ambiguity between
market value and net book value.
MOF’s response:
Not accepted. The term "value" in section
32C(3) applies to both real estate as well as stock
and shares. The term “value” may refer
to either book or market value depending on the
nature of the assets. E.g. "Market value"
will not be applicable to shares of private companies. |
6. MOF thanks all who have responded with their comments.
We will continue the practice of consulting the public
before finalising the amendments to proposed new legislation.
|
