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MOF accepts 31 of 70 suggestions on draft income tax Bill

OF the 70 suggestions on the draft Income Tax (Amendment) Bill 2016, the Ministry of Finance (MOF) has accepted 31 following a public consultation exercise held from June 26 to July 24.

The draft Bill contains proposed legislation to effect the tax changes announced at Budget 2015 in late February this year, as well as other changes arising from the periodic review of the income tax system.

The ministry said the draft Bill will be revised following the acceptance of the suggestions.

It said the remaining 39 suggestions were not accepted as they were inconsistent either with the legislative drafting conventions or the policy objectives of the proposed legislative changes.

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Most of the feedback MOF received focused on the following tax changes: extending and refining the merger and acquisition scheme, enhancing the double tax deduction for internationalisation scheme, introducing the international growth scheme, and extending and enhancing the maritime sector incentive.

One suggestion under the enhancement of the double tax deduction for internationalisation scheme that was accepted was to amend the Act to clarify that a Singapore entity will be treated as having incurred the salary expenditure if it directly incurs that expenditure, or if the overseas establishment incurs the expenditure and is subsequently reimbursed by the Singapore entity.

Another that was accepted was under the introduction of the international growth scheme, where MOF said the definition of "international growth company" will be amended to include a company incorporated and resident in Singapore which provides services to a person or permanent establishment outside Singapore.