Annual Dollar Amounts of Corporate Income Tax Revenues Forgone in Last Five Years from Incentives Granted

Parliamentary Question by Mr Chua Kheng Wee Louis:

To ask the Prime Minister and Minister for Finance in the last five years, for companies currently granted concessionary corporate income tax rates via tax incentives, what is the estimated annual dollar amounts of foregone corporate income tax revenues based on the difference between their effective tax rates versus (i) average effective corporate income tax rates and (ii) the statutory corporate income tax rate.

Parliamentary Reply by Second Minister of Finance, Mr Chee Hong Tat:

Like many jurisdictions, Singapore uses a range of grants and tax incentives to compete for investments. Such incentives are not automatically granted to all companies looking to invest in Singapore. They are offered judiciously, only if the economic agencies assess that the incentive is necessary to land the investment here and the investment will generate a net benefit for Singapore’s economy. The value of incentives awarded is a fraction of the projected total value of the investment. 

Tax revenue forgone from these tax incentives are notional. It is not correct to assume that our tax base will remain unchanged if we did not provide such incentives.