Significant amendments to Singapore’s Income Tax Act 1947 (ITA) and related subsidiary legislation came into effect on 12 April 2024, operationalizing a framework to delegate specific tax incentive administration functions to designated public bodies.
This delegation mechanism was established by the insertion of Section 3A into the ITA in 2020. Section 3A empowers the Minister for Finance, following consultation with the relevant portfolio Minister (e.g., Minister for Trade and Industry), to assign functions or powers under specific tax incentive provisions within the ITA or related regulations to public bodies (e.g., the Economic Development Board).
Under Section 3A, when a public body performs an assigned function or exercises an assigned power, it is treated as acting under the authority of its own establishing legislation. The public body is mandated to carry out these duties in strict accordance with any directions issued by the Minister for Finance.
Key Assignments Effective 12 April 2024:
The recent notifications and legislative amendments formally assign administration for the following tax incentives to the respective public bodies:
- Maritime and Port Authority of Singapore (MPA):
- Approved International Shipping Enterprise (AISE) – s13E
- Maritime Finance Incentive (MFI) – s13P & s43L
- Container Investment Enterprise – s43P
- Container Investment Manager – s43Q
- Approved Shipping and Logistics (ASL) Scheme – s43U
- Enterprise Singapore Board (ESG):
- Approved Venture Companies – s13G
- Management of Approved Venture Company – s43V
- Further Deduction for Expenses Relating to Approved Trade Fairs, Exhibitions, Trade Missions, Overseas Trade Offices, or E-Commerce (shared with STB) – s14B
- Further/Double Deduction for Overseas Investment Development Expenditure – s14H
- Further/Double Deduction for Salary Expenditure for Employees Posted Overseas – s14I
- Deduction for Qualifying Investments in Qualifying Start-up Companies – s37N
- Global Trader Program (GTP) – s43I
- Intellectual Property Development Incentive (IDI) (shared with EDB) – s43X
- Economic Development Board (EDB):
- Not-for-Profit Organisations (NPOs) – s13R
- Land Intensification Allowance (shared with BCA) – s18C
- Waiver of Ownership Requirements for Writing-Down Allowances on IP Rights – s19B
- Finance and Treasury Centre (FTC) – s43E
- Aircraft Leasing Scheme (ALS) – s43N
- Aircraft Investment Managers – s43O
- Intellectual Property Development Incentive (IDI) (shared with ESG) – s43X
- Singapore Tourism Board (STB):
- Further Deduction for Expenses Relating to Approved Trade Fairs, Exhibitions or Trade Missions (shared with ESG) – s14B
- Building and Construction Authority of Singapore (BCA):
- Land Intensification Allowance (shared with EDB) – s18C
This restructuring centralizes the administration of specialized tax incentives within the public bodies most closely aligned with the relevant industries or policy objectives (e.g., maritime incentives with MPA, trade and venture capital with ESG, broad economic development with EDB). Businesses applying for or maintaining these incentives should now engage directly with the assigned public body for matters falling under the delegated functions.
Source: The Electronic Gazette, 15 April 2024.