Singapore Budget 2022 - Tax and Accounting Report Highlights

The Budget contains various measures to support businesses and individuals with job creation, incentives, and tax relief measures.

A $500 million Jobs and Business Support Package was announced to provide targeted help for workers and businesses in segments of the economy that are facing slower recoveries. A $560 million Household Support Package will be provided to help Singaporeans with their utility bills, children’s education, and daily essentials. An additional top-up of $640 million will be made to the Assurance Package to cushion the impact of the GST increase for all Singaporeans.

The full Budget Statement is available at mof.gov.sg/singaporebudget and the Ministry of Finance’s media release is available at mof.gov.sg/singaporebudget/media-centre/media-releases. 

The tax highlights are set out below.

Business tax

• The corporate tax system will be updated in response to the global minimum effective tax rate under the Pillar 2 Global Anti-Base Erosion rules of the Base Erosion and Profit Shifting 2.0 project, which will include a top-up tax called the Minimum Effective Tax Rate.
• The withholding tax exemption for container lease payments under operating lease agreements will be extended to 31 December 2027.
• The tax framework for facilitating corporate amalgamations will be extended to cover amalgamation of Singapore-incorporated licensed insurers where the court order for the confirmation of a scheme for the transfer of an insurance business is made on or after 1 November 2021.
• The range of withholding tax exemptions for the financial sector will be extended till 31 December 2026, with the exception of the withholding tax exemption for payments made under interest rate or currency swap transactions by financial institutions, which will be allowed to lapse after 31 December 2022.
• Insurers will use the Monetary Authority of Singapore Statutory Returns as the basis of preparing tax computations from year of assessment (YA) 2024 (or YA 2025 for insurers whose financial year end is not 31 December).
• The Income Tax Act 1947 and Goods & Services Tax Act 1993 will be amended to facilitate the disclosure of corporate taxpayers’ information by the Inland Revenue Authority of Singapore.
• The Income Tax Act 1947 and Goods & Services Tax Act 1993 will be amended to facilitate the disclosure of corporate taxpayers’ information by the Inland Revenue Authority of Singapore.

Personal tax

• From year of assessment 2024, the top marginal personal income tax rate for resident individual taxpayers will be increased. The portion of chargeable income in excess of $500,000 up to $1 million will be taxed at 23%. Chargeable income in excess of $1 million will be taxed at 24%.
• The withholding tax exemption for non-resident mediators will be extended to 31 March 2023.
• The withholding tax exemption for non-resident arbitrators will be extended to 31 March 2023.

Tax incentives

• The withholding tax exemption for ship and container lease payments under finance lease agreements for Maritime Sector Incentive award recipients will be extended to 31 December 2028.
• The Aircraft Leasing Scheme will be extended till 31 December 2027.
• The Approved Royalties Incentive will be extended till 31 December 2028.
• The Approved Foreign Loan scheme will be extended till 31 December 2028.
• The conditions imposed on investments in physical investment precious metals by funds managed by Singapore-based fund managers will be refined from 19 February 2022.
• The tax exemption schemes for project and infrastructure finance will be extended till 31 December 2025. The concessionary tax rate on qualifying income derived by an Infrastructure Trustee-Manager/Fund Management Company will be allowed to lapse after 31 December 2022.
• The Integrated Investment Allowance scheme will be allowed to lapse after 31 December 2022.

Goods and services tax

• With effect from 1 January 2023, the basis for determining whether zero-rating applies to a supply of travel arranging services will be updated to be based on the place where the customer and direct beneficiary of the service belong.
• The GST rate will be increased from 7% to 8% with effect from 1 January 2023, and from 8% to 9% with effect from 1 January 2024.

Other taxes

• The property tax rates for owner-occupied residential properties will be increased for the portion of annual value in excess of $30,000 in 2 steps, starting with property tax payable in 2023.
• The property tax rates for non-owner-occupied residential properties, including investment properties, will be increased in 2 steps, starting with property tax payable in 2023. 

Any customary the full Wolters Kluwer CCH Singapore Budget Announcement 2022 Tax Report and HR Report are also available to subscribers of CCH IntelliConnect.