Singapore May Face Tax Burden Rise

Singapore’s Prime Minister Lee Hsien Loong says that if the country’s government continues to build ‘inclusive society’, taxes in Singapore will need to be raised.

Now the Singapore government is using national revenue reserves for rising spends including social benefits due to ageing population. Last year the government used for that about USD 6.4 bln out of national reserves, which is almost 14% of its total expenditure and more than the annual revenue from individual income tax.

Lee points out such situation cannot last forever, and if the government’s social spending continues to rise, taxes will also have to be hiked approximately within the next 20 years. However, if Singapore taxes are raised it will concern only Singapore-sourced income. Due to the Singapore territorial system of taxation foreign income derived even by Singapore-based companies will not be taxed there.