Singapore Tax Stimulus

Singapore, the top-ranked economy on the ease of Doing Business for three years in a row, and the 5th out of 181 economies on Paying Taxes, announced a S$20.5 billion ($15 billion) Resilience Package to help businesses and workers on January 22, 2009.

The government will provide a 40% property tax rebate for industrial and commercial properties for 2009 and reduce the corporate income tax rate from 18% to 17% from 2010. It will also give a personal income tax rebate of 20% with a cap of S$2,000 for 2009.

An apparent result of the financial crisis is decreased access to credit. As project financing becomes more precious, the need to maximize returns is magnified. Tax rates and structures, being two important components of operating costs, have ready impacts on the cost models.

Today's businesses have increasingly voiced their taxation concerns. In a recent survey, substantially more respondents ranked tax exemptions, state or local incentives and corporate tax rate as “very important” or “important” for site decisions compared to last year. Now more than ever, countries with well-designed tax systems are able to help their businesses’ growth, and ultimately, overall investment and employment.