Singapore´s Budget 2024

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On Friday, 16 February 2024, Deputy Prime Minister and Minister of Finance, Lawrence Wong presented Singapore’s Budget 2024.  
    
Below we highlighted some of the major Budget announcements. 
    

1. Corporate Income Tax Rebate 

The government will introduce a SGD 1.3 billion Enterprise Support Package to assist businesses. This includes a 50 percent Corporate Income Tax Rebate, capped at SGD 40,000 in the Year of Assessment 2024, and a minimum cash payment of SGD 2,000 for companies that employed at least one local employee in 2023. 
    

2. Refundable Investment Credit

The government will introduce a new tax credit with a refundable cash feature which will support high-value and substantive economic activities such as the setting up or expansion of manufacturing facilities, new innovation and R&D activities, and green transition activities. 
    

3. Local Qualifying Salary

All local employees must be paid at least the Local Qualifying Salary (LQS) if the employer also hires foreign workers. The LQS for full-time workers will be raised to SGD 1,600 / month or SGD 10.50 / hour. 
     

4. CPF Contributions

CPF contribution rates for workers aged 55 to 65 will increase by 1.5 percentage points in 2025. To ease the impact on business costs, half of this increase in employer contributions for 2025 will be provided to employers through the CPF Transition Offset. 
       

5. Property Tax

The Annual Value Bands of owner-occupier residential Property Tax rates will be raised from thresholds between SGD 8,000 and SGD 100,000 to thresholds between SGD 12,000 and SGD 140,000 with effect from 1 January 2025. 
    

6. Base Erosion and Profit Shifting 2.0 (BEPS) Initiative

Singapore will introduce two components of the second pillar of the BEPS for businesses’ financial years on or after 1 January 2025:

  • The Income Inclusion Rule will subject the overseas profits of multinational enterprises (MNE) groups parented in Singapore to a minimum effective tax rate of 15 %, regardless of where they operate.
  • The Domestic Top-up Tax will apply to Singapore profits of MNE groups operating in Singapore and top-up the effective tax rate in Singapore to 15 %.

    These will apply to MNEs with a global revenue of at least €750million annually.
Singapore announced that it will introduce the first pillar of the BEPS and other components of the second pillar later.  

 From The Newsletter

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