BUDGET 2013 - PERSONAL TAX
The Finance minister of Singapore announced several budget initiatives in the Budget 2013 that aims to improve the lives of Singapore citizens. A number of changes were introduced which promotes progressive taxation, building a more inclusive society and encouraging quality growth. This Budget is very much focused on productivity and helping the lower income group as well as the elderly. Although there would not be any drastic changes in the personal tax rates, we could still recognise a considerable amount of money being channelled to the lower income households in Singapore. Taking reference from the KMPG budget 2013, this journal discusses about how successful the proposals, pertaining to personal tax, are in realizing the goals. It highlights and elaborate on the updates of the income tax rebate, tax on accommodation provided and phasing out of the Equity Remuneration Incentive Schemes (ERIS).
Singapore residents will receive a one-time rebate in YA 2013 of 30% of their final chargeable income tax, up to a maximum rebate of $1,500. Residents aged 60 and above will enjoy a 50% rebate, also subject to a maximum of $1,500. This year’s rebate is more progressive than the previous year, as it gives back more in relative terms to individuals with lower taxable incomes than those with higher incomes. The government usually implement such policies such as tax rebate is to provide short-term relief for lower income groups whom finds it harder to pay the required tax. Such rebates are necessary as it is used to help offset the ongoing impact of inflation and provide some relief which helps to decrease the tax burden. Albeit, business and investment losses are deducted from the income tax, it is appreciable that the government steps in to give income tax rebates and income tax relief which benefits the residents.
With effective from YA2015, to simplify tax compliance and make the tax system more reasonable, the Minister has proposed...
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