In his Budget speech on Tuesday (Feb 14), Finance Minister Lawrence Wong announced that Singapore’s corporate tax system will be revised to align with the recommendations of the second pillar of the Inclusive Framework on Base Erosion and Profit Shifting (BEPS 2.0) starting in 2025. The second pillar of BEPS 2.0 proposes a minimum effective tax rate of 15 per cent for multinational enterprise (MNE) groups with annual group revenues of at least 750 million euros. This revision will be implemented in Singapore on or after Jan 1, 2025, as part of a larger international effort to harmonize minimum global corporate tax rates for large MNE groups.
Wong stated that the Singaporean government will also review and modernize its broader range of industry development programs to ensure that Singapore remains competitive in attracting and retaining investments. Moreover, the government will continue to consult with companies operating in Singapore and provide them with adequate notice before any changes to Singapore’s tax regulations or schemes are implemented.