On 8 April 2016, the Manpower Minister of Singapore announced
in the Parliament that new criterion will be introduced in
approving work pass applications aiming at strengthening the
competitiveness of the Singapore workforce. In particular, areas
which will be looked at include (1) the proportion of foreign
employees in a company, (2) whether a company tried to recruit
Singaporeans for the job, and (3) the extent of a company's
contribution to the Singapore economy and society. Companies deemed
weak in all three areas may face difficulties in renewing the
employment passes of existing foreign employees and obtaining new
ones for new expatriate hires.
The Mergers & Acquisitions Scheme which was introduced in
2010 is further enhanced. For qualifying M&A deals made from 1
April 2016 to 31 March 2020, the M&A tax allowance will equal
to 25% of consideration paid per year for up to S$50 million (up
from S$20 million). Stamp duty relief will be granted for up to
S$40 million of the consideration paid for qualifying M&A deals
The Finance and Treasury Centre ("FTC") Scheme is
extended for another 5 years to 31 March 2021. The concessionary
tax rate has been further reduced to 8% on income from qualifying
activities and services. In addition, withholding tax exemption is
extended to interest payments on deposits placed with the FTC by
non-resident approved offices and associated companies.
Tax incentive for trustee companies that originally scheduled
to lapse after 31 March 2016 has been extended with further details
to be released by June 2016 from the Monetary Authority of
Singapore. Scope of qualifying activities will be expanded to align
with trustee activities covered under the Financial Sector
Incentive Standard Tier Scheme. Concessionary tax rate of 12% will
be offered to new incentive recipients while existing award holders
continue to enjoy the 10% concessionary rate until expiry of their
Tax concession for employer-provided home leave passage for
expatriate employees, the Approved Investment Company Scheme
(introduced to promote the investment management industry in
Singapore) and the tax exemption on income derived by non-resident
trading in Singapore in specified commodities via consignment
arrangements will all be withdrawn from the Year of Assessment
The content of this article is intended to provide a general
guide to the subject matter. Specialist advice should be sought
about your specific circumstances.
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