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THE government is raising the marginal tax rates that affect the top 5 per cent of Singapore's income-earners, said Deputy Prime Minister and Finance Minister Tharman Shanmugaratnam on Monday.
The top marginal rate will go up to 22 per cent, from the current 20 per cent, for the highest income-earners with a chargeable income above S$320,000. There will also be smaller adjustments made to raise income tax for the others in the top 5 per cent bracket.
These changes will apply starting with income earned in 2016 and on taxes to be paid in 2017. The move is expected to raise additional revenue of S$400 million a year when it comes into effect.
"This tax increase for high-income earners will enhance progressivity and strengthen future revenues. This is a calibrated move. We have assessed that it should not significantly dent Singapore's competitiveness," said Mr Tharman.