Reduce corporate tax, increase competitiveness: Deloitte Budget wish list

Reduce corporate tax, increase competitiveness: Deloitte Budget wish list

SINGAPORE - Policies to increase business competitiveness are what Singapore needs for 2013, professional services firm Deloitte indicated in its Budget wish list for this year.

The current corporate tax rate should be reduced from 17 per cent to 16.5 per cent or lower to improve competitiveness, said Mr Ajit Prabhu, Partner and Head of Tax Services at Deloitte Singapore and Southeast Asia.

Among the other policies recommended, Deloitte also suggested that Singapore pursue competitive new double tax treaties and re-negotiate old double tax treaties with more competitive terms.

Hong Kong has done the same in the past few years and managed to contract treaties which are more advantageous than the current ones here, Mr Ajit Prabhu added.

In light of global economic uncertainty, the Government should also consider granting tax exemptions to all foreign-sourced income remitted this year, Deloitte said in its wish list.

Mr Lee Tiong Heng, Tax Partner, Deloitte Singapore also said that the Government can consider increasing partial tax exemption for Small and Medium Enterprises (SMEs) from the first $300,000 chargeable income to the first $400,000 chargeable income.

"This will be a targeted measure to reduce the tax burden on SMEs facing challenges in implementing the national economic restructuring agenda," he said.

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