SINGAPORE Trends and Developments Contributed by: Lee Woon Shiu and Cheung Kuan Swan (Catherine), DBS Private Bank
frameworks such as introducing Pillar Two BEPS 2.0 which highlights its global responsibility, has signifi - cant impact on businesses in Singapore. MNEs that previously benefited from tax incentives and paid less than the 15% ETR will now see their ETR rise to this minimum. This shift necessitates that businesses pre - pare for more detailed data collection, ensure timely registration with the IRAS, and stay updated on the interaction between Singapore’s tax framework and foreign regimes to maintain compliance and opti - mise their tax positions. While traditional tax incen - tives offering lower rates may become less effective, Singapore is adopting “non-tax” measures like the RIC to attract and retain businesses, leveraging the additional tax revenue from Pillar Two BEPS 2.0 to improve infrastructure, talent development, and green energy transitions. The enhanced tax incentives will continue to attract investment and support innovation with a clear message to businesses that tax benefits are intended as a reward for investment, innovation, sustainability and local employment.
Singapore’s ongoing competitiveness will depend not only on attractive tax rates, but also on critical factors such as maintaining a strong legal framework, a highly skilled workforce, advanced digital infrastructure and targeted industry incentives. *** Disclaimer: DBS Bank is not a law firm. The informa - tion provided in this article is for general informational purposes only and does not constitute legal advice. Neither of the authors are licensed attorneys or legal professionals under Singapore law to provide legal advice. Readers are advised to consult with a licensed attorney or other qualified professional regarding any legal matters or concerns.
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