The 2024 Budget introduces important changes and tax measures to support businesses, encourage investment, and enhance Singapore’s competitiveness. Notable among the proposals is the introduction of a refundable investment credit (RIC) scheme. This scheme, which targets high-value economic activities, provides tax credits that companies can use to offset various taxes, including corporate income tax and top-up taxes from multinational enterprises. However, the proposal limits the types of taxes against which the RICs can be applied, excluding withholding taxes. The Ministry of Finance’s decision not to allow RICs to offset a broader range of taxes, like property or goods and services tax, could impact the scheme’s flexibility, though businesses may benefit from future revisions.

Additionally, the Budget also brings about a significant change for shipping enterprises with the introduction of an alternative tax based on net tonnage for qualifying shipping entities. This new tax system is aimed at easing compliance burdens and ensuring Singapore’s continued position as an international maritime hub. The changes will also incentivize shipping companies using ‘green ships’ with tax discounts, aligning the country’s tax system with its environmental goals. Other measures include the extension of tax incentives for funds managed by Singapore-based managers and the introduction of new concessionary tax rates for specific industries like aircraft leasing and intellectual property development. These changes seek to maintain Singapore’s appeal as a global business and investment hub.