Income Tax (Amendment) Bill

Bill No. 6/1980

Read the first time on 26th February 1980.

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, 1980.

(2) Sections 2(b), 2(c) and 3(a) shall have effect for the year of assessment 1979 and subsequent years of assessment.

(3) Sections 2(a), 7, 8(b), 10, 11 and 12 shall have effect for the year of assessment 1980 and subsequent years of assessment.

Amendment of section 10

2. Section 10 of the Income Tax Act (hereinafter in this Act referred to as the principal Act) is amended —

(a)

by inserting, immediately after the word “property” at the end of subsection (1A), the words “and for the purposes of this proviso any property owned by a married woman living with her husband shall be deemed to be owned by the husband”;

(b)

by deleting subsection (6A); and

(c)

by inserting, immediately after subsection (7), the following subsection: —

“(8) Any maintenance payment received by a child under a maintenance order or a deed of separation shall not be deemed to be income for the purposes of paragraph (e) of subsection (1) of this section.”.

Amendment of section 13

3. Section 13 of the principal Act is amended —

(a)

by deleting the full-stop at the end of paragraph (w) of subsection (1) and substituting a semicolon, and by inserting immediately thereafter the following paragraph: —

“(x)	the income derived by a person resident in Singapore from any pension granted under any written law relating to pensions in Singapore or under such other pensions scheme as may be approved by the Minister by notification in the Gazette.”;

(b)

by inserting, immediately after the word “tax” in the first line of subsection (7), the words “wholly or in part”; and

(c)

by deleting subsection (8) and substituting the following: —

“(8) Any order made under subsection (7) of this section may be either general or specific and may prescribe the conditions subject to which the income will be exempt from tax but such conditions need not be included in the order for the purpose of publication in the Gazette.”.

Amendment of section 14

4. Section 14 of the principal Act is amended by inserting, immediately after subsection (3), the following subsection: —

“(3A) For the purposes of application to a motor car acquired on or after the 1st day of April 1979, the reference to “fifteen thousand dollars” in subsection (3) of this section shall, wherever it occurs, be read as a reference to “twenty-five thousand dollars”.”.

Amendment of section 14B

5. Section 14B of the principal Act is amended by deleting paragraph (c) of subsection (3) and substituting the following: —

“(c)	any expenses incurred during its tax relief period (or qualifying period in the case of investment allowance) by a company which is given tax relief under the Economic Expansion Incentives (Relief from Income Tax) Act (Cap. 135);”.

New sections 14C and 14D

6. The principal Act is amended by inserting, immediately after section 14B, the following sections: —

“Further deduction for export market development expenditure

14C.—(1) Subject to this section, where the Comptroller is satisfied that —

(a)	export market development expenditure for the carrying out of an approved marketing project overseas; or
(b)	advertising expenses in respect of advertisements placed in any approved Singapore publication designed for publicity overseas,

have been incurred on or after the 1st day of April 1979, by a company resident in Singapore principally for promoting the export of goods manufactured in Singapore, there shall be allowed a further deduction of the amount of such expenditure in addition to the deduction allowed under section 14 of this Act.

(2) The Minister may specify the maximum amount of export market development expenditure (or any item thereof) or of advertising expenses to be allowed under subsection (1) of this section.

(3) No deduction shall be allowed under this section in respect of —

(a)	any expenses which are not allowed as deductions under section 14 of this Act;
(b)	any expenses incurred during its tax relief period (or qualifying period in the case of investment allowance) by a company which is given tax relief under the Economic Expansion Incentives (Relief from Income Tax) Act (Cap. 135);
(c)	any expenses which are allowed as deductions under section 14B of this Act; or
(d)	travelling, accommodation and subsistence expenses or allowances for more than two employees taking part overseas in the approved marketing project.

(4) For the purposes of this section —

(a)

“approved” means approved by the Minister or such person as he may appoint;

(b)

“export market development expenditure” means —

(i)	expenses directly attributable to the carrying out of export market research or obtaining of export market information;
(ii)	expenses in respect of advertisements placed in overseas news media, including television, newspapers and trade journals; or
(iii)	expenses incurred on overseas export promotion campaigns.

Expenditure on scientific research

14D.—(1) For the purpose of ascertaining the income of any person carrying on a manufacturing trade or business, the following expenditure incurred on or after the 1st day of April 1979 (other than any amount which is allowable as a deduction under section 14 of this Act) by that person shall be allowed as a deduction: —

(a)	expenditure incurred on scientific research carried out in Singapore and related to that trade or business (except to the extent that it is capital expenditure on plant, machinery, land or buildings or on alterations, additions or extensions to buildings or in the acquisition of rights in or arising out of scientific research); and
(b)	payments to an approved research institute for scientific research related to that trade or business.

(2) In this section —

“approved research institute” means any institute or body which is approved by the Minister for the purposes of this section;

“scientific research” means any activities in the fields of natural or applied science for the extension of knowledge.

(3) For the purposes of this section —

(a)	any reference to scientific research related to a trade or business shall be read as including a reference to any scientific research which may lead to or facilitate an extension, or an improvement in the technical efficiency, of that trade or business; and
(b)	any expenditure incurred by a person prior to the commencement of his manufacturing trade or business shall be deemed to have been incurred by that person on the first day on which he carries on that trade or business.”.

Amendment of section 15

7. Section 15 of the principal Act is amended —

(a)

by inserting, immediately after the word “thereunder” at the end of paragraph (j), the words “except where the motor car is registered outside Singapore and used exclusively outside Singapore”; and

(b)

by renumbering the section as subsection (1), and by inserting immediately thereafter the following subsection: —

“(2) Paragraphs (b) and (d) of subsection (1) of this section shall not apply to any expenditure which qualifies for deduction under section 14D of this Act.”.

Amendment of section 19

8. Section 19 of the principal Act is amended —

(a)

by deleting the full-stop at the end of subsection (2A) and substituting a colon, and by inserting immediately thereafter the following proviso: —

“Provided that in respect of a motor car acquired on or after the 1st day of April 1979, the reference to “fifteen thousand dollars” in this subsection shall, wherever it occurs, be read as a reference to “twenty-five thousand dollars”.”; and

(b)

by inserting, immediately after the word “thereunder” at the end of subsection (2D), the words “except where the motor car is registered outside Singapore and used exclusively outside Singapore”.

Amendment of section 20

9. Section 20 of the principal Act is amended —

(a)

by inserting, immediately after the words “3rd day of March 1975” in paragraph (a) of subsection (5), the words “, and before the 1st day of April 1979,”;

(b)

by deleting the word “and” at the end of paragraph (a) of subsection (5), and by inserting immediately thereafter the following paragraph: —

“(aa)

a motor car acquired on or after the 1st day of April 1979, paragraph (a) of this subsection shall apply except that the reference to “15,000” in the formula in that paragraph shall be read as a reference to “25,000”; and”; and

(c)

by inserting, immediately after subsection (5), the following subsection: —

“(5A) Notwithstanding anything contained in the preceding provisions no balancing allowance shall be made in respect of a motor car within the meaning of subsection (2C) of section 19 of this Act which is not, for any basis period after the basis period for the year of assessment 1981, registered as a business service passenger vehicle for the purposes of the Road Traffic Act (Cap. 92) and the rules made thereunder.”.

Amendment of section 26

10. Section 26 of the principal Act is amended —

(a)

by inserting, immediately before the word “reinsuring” in subsection (1A), the words “insuring and”;

(b)

by inserting, immediately before the word “reinsuring” in the fourth line of the proviso to subsection (2), the words “insuring and”; and

(c)

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

“(5) For the purposes of this section and section 43C of this Act,

“offshore risks” means any risk outside Singapore and —

(a)	in relation to direct general insurance or facultative general reinsurance the insured is not a person resident in Singapore or a permanent establishment in Singapore; and
(b)	in relation to treaty general reinsurance not less than seventy-five percent of the total risk in terms of gross premiums is outside Singapore,

and where any such risk is in transit in Singapore it shall be deemed to be outside Singapore.”.

Amendment of section 39

11. Section 39 of the principal Act is amended by deleting sub-paragraph (ii) of the proviso to paragraph (e) of subsection (2) and substituting the following: —

“(ii)

no such deduction shall be allowed in excess of four thousand dollars except that where the contributions recoverable under subsection (2) of section 6 of the Central Provident Fund Act (Cap. 121) or the contributions made to a designated pension or provident fund exceed four thousand dollars the excess contributions, to the extent of one thousand dollars, shall be allowed as a deduction; and for this purpose a “designated pension or provident fund” means an approved fund designated by the Minister;”.

Amendment of section 43C

12. Section 43C of the principal Act is amended by inserting, immediately before the word “reinsuring” in the last line, the words “insuring and”.

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