High-rise buildings in Singapore. (PHOTO: Roslan Rahman/AFP via Getty Images)
SINGAPORE — Singapore will be taxing more from high earners, with increases in their personal income taxes as well as wealth taxes such as property and luxury-car taxes.
Finance Minister Lawrence Wong said during his Budget speech on Friday (18 February) that the top marginal personal income tax rate will be increased, with effect from the year of assessment 2024, which is for income earned from 1 January to 31 December 2023.
Resident taxpayers’ chargeable income in excess of $500,000 up to $1 million will be taxed at 23 per cent, while income in excess of $1 million will be taxed at 24 per cent. This is up from the current 22 per cent tax levied on income in excess of $320,000.
Meanwhile, property tax rates for non-owner-occupied residential properties will be increased to 12 per cent to 36 per cent, with the increase more significant for properties with a higher annual value.
This compares to the current 10 per cent to 20 per cent tax levied on such properties.
At the same time, the property tax rates for owner-occupied homes with an annual value in excess of $30,000 will also be raised, ranging from 6 per cent to 32 per cent. This compares to 4 per cent to 16 per cent for such homes today.
Finally, an additional ARF (Additional Registration Fee) tier for cars will be introduced at a rate of 220 per cent for the portion of open market value in excess of $80,000.
The new rates will apply to all cars registered with COEs (certificates of entitlement) obtained from the second COE bidding round this month.
Those with greater means contribute a larger share: Wong
Wong said that the increase in the top marginal personal income tax is expected to affect the top 1.2 per cent of personal income taxpayers, and will raise $170 million of additional tax revenue per year.
The new property taxes will also raise Singapore’s property tax revenue by about $380 million a year when fully implemented, while the additional ARF is expected to generate an additional $50 million in revenue this year.
“Everyone chips in and contributes to a vibrant economy and strengthened social compact, but those with greater means contribute a larger share,” Wong said in his speech.
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