Singapore is gearing up for some changes in its financial landscape, with Finance Minister Lawrence Wong announcing a shift in corporate tax policies and a push towards becoming an artificial intelligence (AI) hub in the city-state’s 2024 budget.
Wong, who also serves as deputy prime minister, revealed that Singapore plans to raise corporate taxes on multinationals starting next year, aligning itself with international efforts to ensure fair taxation. The government expects to see a small budget surplus in 2024, a positive turn following a deficit in the previous fiscal year.
To offset the impact of the tax changes, Singapore will offer relief measures to businesses, including a 50% corporate income tax rebate and a new “Refundable Investment Credit” scheme aimed at encouraging investment in areas like manufacturing, headquarters activities, and research and development.
In addition to the tax adjustments, Singapore is investing SG$1 billion over the next five years to bolster talent and industry development in AI. This investment includes securing access to advanced chips and collaborating with leading companies to establish AI centers of excellence in Singapore.
These changes come at a crucial time for Singapore’s economy, which is facing challenges from sluggish global growth and inflationary pressures. Despite the uncertainties, Wong remains optimistic about Singapore’s economic prospects and is committed to addressing cost-of-living concerns for Singaporeans through various measures, including cash payments and utility bill rebates.
As Singapore navigates these changes, it remains focused on ensuring a stable and prosperous future for its residents and businesses, positioning itself as a competitive and innovative hub in the global economy.
(Source: Nikkei Asia | The Straits Times)
