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MOF Accepts Most Of Suggestions To Amend Draft Income Tax Bill 
Posted on Sunday, October 07, 2007 - 08:00 PM

The Ministry of Finance (MOF) has accepted most of the suggestions on the Income Tax (Amendment) Bill 2007 that were received during the public consultation exercise held from 15 June to 14 July 2007. A total of 29 comments were received, most of the feedback being from professional bodies and companies. All the suggestions received were constructive and were each considered carefully by MOF. Of these, 21 suggestions were accepted and have been incorporated into the final draft Bill.

2. This is the fifth time that draft income tax legislation has been published for consultation. The draft Income Tax (Amendment) Bill 2007 put out for public consultation contained proposed legislation to effect changes announced in Budget 2007 and other changes to be introduced arising from ongoing reviews of the income tax system. The consultation exercise for the draft Bill sought feedback on how the draft legislation could be improved in terms of clarity or aiding compliance by taxpayers. For non-Budget 2007 tax changes, MOF also sought comments on the policy aspects of the proposed legislative amendments, besides the drafting aspects.

3. Almost half (14 out of 29) of the comments received related to the drafting of the Income Tax (Amendment) Bill 2007. The other comments were requests to review tax policies or to clarify the policy intent behind the tax changes. The tax changes that received the most comments were as follows:

(a) Tax deduction of borrowing costs;

(b) Tax treatment of qualifying debt securities (QDS);

(c) Tax treatment of Real Estate Investment Trusts (REITS).

4. The 8 comments which have not been accepted by MOF include suggestions that were inconsistent with convention in drafting legislation or were beyond the scope of the underlying objectives of the tax policy in question.

5. The Ministry of Finance thanks all respondents who participated in this consultation exercise. We will continue the practice of consulting the public before finalising the amendments to our income tax laws. The Ministry of Finance’s responses to the key comments received are also summarised on the MOF website at http://www.mof.gov.sg/consultation_current/index.html and can be found at Annex A of this release.

MINISTRY OF FINANCE
SINGAPORE
7 October 2007