Public Consultation on the Draft Income Tax (Amendment) Bill 2019

Ministry of Finance

Consultation Period: 19 Jun 2019 - 10 Jul 2019

Status: Closed

Detailed Description

INTRODUCTION

1. The Ministry of Finance is conducting a public consultation on the draft Income Tax (Amendment) Bill 2019 from 19 June to 10 July 2019, and invites the public to give feedback on the draft Bill. 

SCOPE OF THE CONSULTATION

2. The draft Income Tax (Amendment) Bill 2019 incorporates 21 proposed legislative amendments to the Income Tax Act (“ITA”):

   1. Budget 2019 changes. There are 7 changes announced in the 2019 Budget Statement. The key changes are:

      1. Personal Income Tax Rebate. As part of the Bicentennial Bonus, a Personal Income Tax Rebate of 50% of tax payable capped at $200 will be granted to all tax resident individuals for Year of Assessment (“YA”) 2019 (i.e. for income earned in 2018). 

      2. Lapse the Not Ordinarily Resident ("NOR") Scheme. Introduced in Budget 2002, the NOR scheme will lapse after YA 2020. The last such NOR status will be granted for YA 2020 and expire in YA 2024. Individuals who have been accorded the NOR status and continue to meet the conditions will continue to be granted NOR tax concessions until their status expires.  

      3. Extend and refine the tax incentive schemes for funds managed by Singapore-based fund managers. To continue to grow Singapore’s asset management industry, the tax concessions relating to qualifying funds under Sections 13CA/ 13R/ 13X of the ITA will be extended till 31 December 2024 along with refinements to the scheme parameters.

   2. Other proposed amendments.  There are 12 changes to existing tax policies and administration, arising from the periodic review of Singapore’s income tax system. The changes include introducing a prescribed deemed expense ratio for tax resident individuals who are self-employed commission agents (i.e. general commission agents, insurance agents, real estate agents, and remisiers) earning gross annual commission income of up to $50,000 in respect of which there are deductible outgoings or expenses. To ease tax compliance, these commission agents will be allowed to claim tax deduction based on either (i) a prescribed deemed expense ratio, set at 25% of gross commission income; or (ii) the actual amount of expenses incurred in the production of their commission income. This will be effective from YA 2020, i.e. in respect of income earned in 2019. The remaining two changes are technical amendments.

3. The  summary table provides a brief description of the tax changes and explains the amendments to the ITA. Please refer to the draft Income Tax (Amendment) Bill 2019 and its accompanying Explanatory Statement for details.

GUIDELINES

4. We would appreciate your support and participation to ensure that the consultation is productive and focused. Respondents are requested to observe these guidelines:

   1. Please identify yourself and the organisation you represent (if any) so that we can follow up to clarify any comments if needed.

   2. Be clear and concise in your comments. 

   3. Focus your comments on how the legislative amendments can be better written to make them clearer and to make compliance easier, or on how the non-Budget tax policy changes can be improved.

   4. Use the prescribed template provided to organise your feedback.

   5. As far as possible, explain your points with illustrations, examples, data or alternative formulations of the amendments.

5. This draft legislation is released only for the purpose of consultation and should therefore not be used for individual or business decisions as it does not represent the final legislation. 

6. All comments received during the consultation will be reviewed thoroughly and if accepted, will be incorporated in the Bill for introduction in Parliament.

PERIOD OF CONSULTATION

7. The draft Income Tax (Amendment) Bill 2019 is available for public consultation from 19 June to 10 July 2019. We regret that comments received after 10 July 2019 will not be considered, as they will not be in time for incorporation in the Bill.

FEEDBACK CHANNEL

8. We encourage all interested parties to submit your comments using the  prescribed template, through: 

   1. email to pc_itabill@mof.gov.sg (preferred mode); or 

   2. fax to 6337 4134; or

   3. post to:

      • Ministry of Finance
        100 High Street, #10-01
        The Treasury
        Singapore 179434

      • Attention: Tax Policy Directorate

SUMMARY OF RESPONSE

9. We will publish a summary of the main comments received on the Ministry of Finance’s website, together with our responses, by the end of August 2019. The identity of respondents will not be disclosed in the summary.  

DOCUMENTS TO DOWNLOAD

10. For reference, please refer below to download the relevant documents for this public consultation.

Entire Bill [PDF, 467 KB]

Clause 1 to 43 [PDF, 410 KB]

Explanatory Statement [PDF, 173 KB]

Summary table budget [PDF, 220 KB]

Summary table (non-budget) [PDF, 340 KB]