Budget 2025: Tax rebates, exemption, to draw companies and fund managers to list in Singapore
The tax incentives will be awarded for five-year periods
TAX incentives will be introduced to encourage Singapore-based companies and fund managers to list in Singapore and grow their economic activities here, said Finance Minister Lawrence Wong on Tuesday (Feb 18).
The moves are part of the first set of measures developed by the equities market review group, chaired by Second Minister for Finance Chee Hong Tat, to strengthen the attractiveness of the local bourse.
The three tax incentives will target corporate listings, fund-manager listings and fund managers’ qualifying income arising from funds investing substantially in Singapore-listed equities.
The listing corporate income tax (CIT) rebate will be introduced for companies and registered business trusts that are tax residents in Singapore.
Companies that put up primary listings will receive a 20 per cent CIT rebate, while those with secondary listings with share issuance will receive a 10 per cent rebate. Companies will need to remain listed on the Singapore Exchange (SGX) for five years.
The rebates are subject to a cap of S$6 million per Year of Assessment (YA) for qualifying entities with market capitalisation of at least S$1 billion, or S$3 million per YA for entities with market capitalisation of less than S$1 billion.
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The scheme will be open for award until Dec 31, 2027, and be awarded for five years per qualifying entity.
On the other hand, newly listed fund managers will benefit from enhancements to the Financial Sector Incentive – Fund Management through an enhanced concessionary tax rate (CTR).
Singapore fund managers or their holding companies that achieve a primary listing on the SGX and remain listed for five years will receive a 5 per cent CTR on their qualifying income.
The fund manager must also distribute a portion of its profits as dividends and meet minimum requirements for professional headcount and assets under management (AUM).
The CTR will be open for award until Dec 31, 2028, and be awarded for five years per fund manager.
Fund managers will also benefit from corporate tax exemption on their qualifying income arising from funds invested substantially in Singapore-listed equities.
Besides meeting minimum requirements for professional headcount and AUM, new funds must have at least 30 per cent of AUM invested in Singapore-listed equities to qualify.
For existing funds, companies will also need to have annual net inflows equivalent to at least 5 per cent of the fund’s AUM in the preceding year to qualify.
The corporate tax exemption will be open for award until Dec 31, 2028, and be awarded for five years per fund managed by fund manager.
Wong, who is also prime minister, said that the review group will share more details on its measures in the coming days.
For more Budget stories, visit businesstimes.com.sg/singapore-budget-2025
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