Singapore needs to remain competitive
To continue to attract foreign direct investments from multinational corporations, it should focus on its existing trump card - tax competitiveness.
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SINCE independence, Singapore has stood out in the Asia-Pacific for attracting foreign direct investments (FDI) through its free, open and diversified economy.
However, global competition is intensifying. Our Asia-Pacific neighbours are enhancing their own competitiveness, and some of our traditional trading partners have also adopted a more protectionist stance to boost their economic prospects. One of the biggest indicators of this is the gradual decline of corporate income tax (CIT) rates by an average of seven percentage points this past decade in the Asia-Pacific.
Recent tax reforms in the US will see the headline CIT rate decline from 35 per cent to 21 per cent. In Europe, the UK's CIT rate is heading towards 17 per cent by 2020.
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