Income Tax (Amendment) Bill

Bill No. 20/1984

Read the first time on 29th June 1984.

An Act to amend the Income Tax Act (Chapter 141 of the Revised Edition).

Be it enacted by the President with the advice and consent of the Parliament of Singapore, as follows:

Short title

1.—(1) This Act may be cited as the Income Tax (Amendment) Act 1984.

(2) Sections 4, 5, 6, 7, 8, 9, 10, 13 and 14 shall have effect for the year of assessment 1985 and subsequent years of assessment.

Amendment of section 2

2. Section 2 of the Income Tax Act (referred to in this Act as the principal Act) is amended by renumbering the section as subsection (1) of that section, and by inserting immediately thereafter the following subsection:

“(2) For the purposes of this Act where an individual is present in Singapore for any part of a day his presence on that day shall be counted as one day.”.

Amendment of section 13

3. Section 13 of the principal Act is amended —

(a)

by deleting subsection (1)(j) and substituting the following paragraph:

“(j)	sums standing to the account of an individual in any approved pension or provident fund or society, or withdrawn therefrom;”;

(b)

by deleting the words “syndicated offshore loans” in subsection (1)(y) and substituting the words “the operation of its Asian Currency Unit”;

(c)

by deleting the full-stop at the end of subsection (1)(y) and substituting a semi-colon, and by inserting immediately thereafter the following paragraph:

“(z)	for a period of 5 years from the commencement of its business, such income of the Singapore International Monetary Exchange Limited as may be prescribed.”; and

(d)

by deleting subsection (3) and substituting the following subsection:

“(3) There shall be exempt from tax for any year of assessment any income arising from sources outside Singapore and received by any individual who is not resident in Singapore in that year of assessment.”.

Amendment of section 19A

4. Section 19A of the principal Act is amended —

(a)

by deleting subsection (1) and substituting the following subsection:

“(1) Notwithstanding section 19 where a person carrying on a trade, profession or business incurs capital expenditure on or after 1st January 1984 on the provision of machinery or plant for the purposes of that trade, profession or business he shall, in lieu of the allowances provided by section 19, be entitled for a period of 3 years to an annual allowance of 33¹/₃% in respect of the capital expenditure incurred.”;

(b)

by inserting, immediately after the words “provided by” in subsection (1A), the words “subsection (1) or”;

(c)

by deleting the words “; and such allowance shall, in relation to a computer or other prescribed office automation equipment in respect of which allowances have been made under section 19, be treated as if it has been made under that section for the purpose of section 20(4)” in subsection (1B);

(d)

by inserting, immediately after subsection (1B), the following subsection:

“(1C) Notwithstanding section 19 where a person proves to the satisfaction of the Comptroller that he has installed a robot for the purposes of a trade, business or profession carried on by him he shall, in lieu of the allowances provided by subsection (1) or section 19, be entitled, if he so elects, to an allowance of 100% in respect of the capital expenditure incurred during or after the basis period for the year of assessment 1985 on the provision of that robot.”;

(e)

by deleting paragraphs (b), (c), (d), (e), (f), (g) and (h) of subsection (4) and substituting the following paragraph:

“(b)

machinery or plant shall be deemed not to include the following motor vehicles within the meaning of the Road Traffic Act (Cap. 92) —

(i)	a motor car;
(ii)	a motor cycle;
(iii)	a goods vehicle the maximum laden weight of which does not exceed 3 tonnes.”;

(f)

by deleting subsection (5) and substituting the following subsection:

“(5) Where at the end of the basis period for the year of assessment 1985 a person has in use machinery or plant in respect of which capital allowances have been made under section 19, there shall be made to him, if before the end of that year of assessment he so elects, for a period of 3 years an annual allowance of 33¹/₃% in respect of the capital expenditure remaining unallowed under section 19 in respect of the machinery or plant as at the end of that basis period:

Provided that in the case of a person to whom a certificate has been issued under Part II, III, IV, IVA, VIB or VIC of the Economic Expansion Incentives (Relief from Income Tax) Act (Cap. 135) and who has, at the end of the basis period immediately following the expiry of his tax relief period, in use, machinery or plant in respect of which capital allowances have been made under section 19, the election under this subsection shall be made before the end of the year of assessment which relates to that basis period.”; and

(g)

by deleting the words “subsection (1B)” in subsection (6) and substituting the words “subsection (1B) or (5)”.

Amendment of section 20

5. Section 20 (4) of the principal Act is amended by deleting the word “or” at the end of paragraph (a) and substituting the word “and”.

Amendment of section 21

6. Section 21 of the principal Act is amended by inserting, immediately after subsection (3), the following subsection:

“(4) This section shall not apply to the provision of a new motor car unless it is registered as a business service passenger vehicle for the purposes of the Road Traffic Act (Cap. 92) and the rules made thereunder; and for the purpose of this section, where the capital expenditure incurred in providing a new motor car exceeds $35,000 the expenditure incurred shall be deemed to be $35,000.”.

Amendment of section 23

7. Section 23 of the principal Act is amended by inserting, immediately after subsection (1), the following subsection:

“(1A) Where any person entitled to the allowances under sections 16 and 17 in respect of an industrial building or structure derives income from the letting of that building or structure, subsection (1) shall, in relation to the allowances under those sections, apply to him so long as he continues to derive such income, whether or not he is carrying on a business in respect of the letting of the building or structure.”.

Amendment of section 24

8. Section 24(2)(a) of the principal Act is amended by inserting, immediately after the word “Act” at the end of the proviso, the words “and unless the machinery or plant was not leased by the seller to the buyer before the sale”.

Amendment of section 26

9. Section 26(3) of the principal Act is amended by inserting, immediately after the word “company” in the third line of the proviso, the words “and the total gains or profits realised from the sale of its investments”.

Amendment of section 42

10. Section 42 of the principal Act is amended by inserting, immediately after subsection (2), the following subsection:

“(3) The tax payable by any individual or Hindu joint family resident in Singapore for any year of assessment on the first $10,000 of chargeable income shall be reduced by 10%.”.

Amendment of section 43A

11. Section 43A of the principal Act is amended by deleting the words “income arising from syndicated offshore loans where the syndication work is carried out in Singapore, and, notwithstanding section 37(2), for the deduction of any loss arising from such syndicated offshore loans to be made only against the income so exempted” and substituting the words “such income and for the deduction of losses otherwise than in accordance with section 37(2)”.

Repeal and re-enactment of section 43D

12. Section 43D of the principal Act is repealed and the following section substituted therefor:

“Concessionary rate of tax for offshore gold and futures transactions

43D.—(1) Notwithstanding section 43, the Minister may by regulations provide that tax at the rate of 10% or such other concessionary rate be levied and paid for each year of assessment upon such income as the Minister may specify of a member of the Singapore International Monetary Exchange derived from transactions in gold bullion or in any approved commodity or financial futures on any approved exchange or in any approved market with —

(a)	an Asian Currency Unit of a financial institution;
(b)	another member of the Exchange;
(c)	a person who is neither a resident of nor a permanent establishment in Singapore; or
(d)	a branch office outside Singapore of a company resident in Singapore,

and those regulations may provide for the deduction of losses otherwise than in accordance with section 37(2).

(2) In this section, “approved” means approved by the Minister or such person as he may appoint.”.

Amendment of Second Schedule

13. The Second Schedule to the principal Act is amended by deleting Part A and substituting the following Part:

“Part A

Rates of Income Tax on Chargeable
Income of An Individual or
A Hindu Joint Family

Chargeable Income

Rate of Tax

For every dollar of the first

5,000

4 per cent

For every dollar of the next

2,500

7 per cent

For every dollar of the next

2,500

9 per cent

For every dollar of the next

5,000

10 per cent

For every dollar of the next

5,000

12 per cent

For every dollar of the next

5,000

15 per cent

For every dollar of the next

10,000

18 per cent

For every dollar of the next

15,000

22 per cent

For every dollar of the next

25,000

26 per cent

For every dollar of the next

25,000

29 per cent

For every dollar of the next

50,000

31 per cent

For every dollar of the next

50,000

34 per cent

For every dollar of the next

200,000

37 per cent

For every dollar of the next

350,000

39 per cent

For every dollar exceeding

750,000

40 per cent

”.

Amendment of Fifth Schedule

14. The Fifth Schedule to the principal Act is amended —

(a)

by deleting paragraph 8 and substituting the following paragraph:

“8. Where a married woman who has elected to be charged in her own name under section 51(4) has passed at one sitting the examination for the General Certificate of Education with at least 5 subjects at ordinary level or has equivalent or higher educational qualification, the deductions in respect of the first 3 eligible children if claimed by her only shall be as follows:

	For the first child 5% of her earned income, in addition to the appropriate deduction allowable under paragraph 1 or 2 of this Schedule, subject to a maximum of $10,000.
	For the second child 10% of her earned income, in addition to the appropriate deduction allowable under paragraph 1 or 2 of this Schedule, subject to a maximum of $10,000.
	For the third child 15% of her earned income, in addition to the appropriate deduction allowable under paragraph 1 or 2 of this Schedule, subject to a maximum of $10,000.”;

(b)

by deleting the words “is a specially qualified person” in paragraph 9 and substituting the words “possesses the qualification specified in paragraph 8”; and

(c)

by deleting paragraph 10 and substituting the following paragraph:

“10. For the purposes of this Schedule —

(a)	“child”, in relation to an individual claiming a deduction, means a legitimate child, stepchild or child adopted in accordance with any written law relating to the adoption of children;
(b)	where any question arises as to whether any qualification is equivalent to or higher than that specified in paragraph 8 it shall be determined by the Minister whose decision shall be final.”.

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