Income Tax (Concessionary Rate of Tax for SIMEX Members) (Amendment No. 2) Regulations 1996

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Published in Subsidiary Legislation Supplement
on 26 Apr 1996

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No. S 181

Income Tax Act

Chapter 134

Income Tax (Concessionary Rate of Tax for SIMEX Members) (Amendment No. 2) Regulations 1996

In exercise of the powers conferred by section 43D of the Income Tax Act, the Minister for Finance hereby makes the following Regulations:

1. These Regulations may be cited as the Income Tax (Concessionary Rate of Tax for SIMEX Members) (Amendment No. 2) Regulations 1996 and shall have effect for the year of assessment 1996 and subsequent years of assessment.

2. The Income Tax (Concessionary Rate of Tax for SIMEX Members) Regulations (Rg 16) are amended by inserting, immediately after regulation 3, the following regulation:

“3A.—(1) Notwithstanding regulation 3, tax shall be payable at the rate of 5% on the incremental income derived by a company which is a SIMEX corporate member for any qualifying year of assessment from any designated transaction, if the following conditions are satisfied:

(a)	the company has been a SIMEX corporate member for at least 3 years immediately preceding that qualifying year of assessment; and
(b)	the company is among the top 20 SIMEX corporate members as determined by SIMEX in respect of the total volume of transactions (excluding trades cleared for other SIMEX members) in SIMEX contracts in the year immediately preceding the year in which trading of the designated futures on SIMEX commences.

(2) For the purposes of this regulation —

“designated futures” means any financial futures or petroleum futures (including futures in petroleum products) or gold futures which commenced trading on SIMEX on or after 1st April 1994;

“designated transaction” means any relevant transaction where the futures transacted is a designated futures;

“incremental income”, in relation to any designated transaction carried out by a company for any qualifying year of assessment, means the amount of income determined in accordance with the formula —

whichever is the less,

where

(A)

is the relevant income of the company from the designated transactions relating to the same designated futures for that qualifying year of assessment;

(B)

is the relevant income of the company from the designated transactions relating to the same designated futures as in A for the qualifying year of assessment in which tax at the rate of 5% under this regulation was last levied on the relevant income from such designated transactions; or where tax at the rate of 5% under this regulation had not previously been so levied, B shall be treated as nil;

(C)

is the relevant income of the company for that qualifying year of assessment derived from the total relevant transactions; and

(D)

is the chargeable income of the company for that qualifying year of assessment, after deducting any investment allowance given under Part X of the Economic Expansion Incentives (Relief from Income Tax) Act (Cap. 86), which is subject to tax at the rate of 10% under regulation 3;

“qualifying year of assessment” in relation to any designated futures, means any year of assessment (after year of assessment 1995) which is within the period of 5 years of assessment immediately following the year of commencement of trading of the designated futures on SIMEX;

“relevant income” in relation to any relevant transaction or to any designated transaction carried out by the company for any qualifying year of assessment, means the amount of income (if any) derived by the company from the relevant transaction or the designated transaction, as the case may be, ascertained in accordance with the provisions of the Act except that the following amounts shall not be deducted:

(a)	the amount of any allowances granted for that qualifying year of assessment under sections 16, 17, 18, 19, 19A, 20, 21 and 22 of the Act and any losses incurred in respect of that qualifying year of assessment, in respect of any other transaction; and
(b)	the amount of any unabsorbed allowances and any unabsorbed losses in respect of any year of assessment preceding that qualifying year of assessment which would otherwise be available under sections 23 and 37(2) of the Act, respectively.”.

3. Regulation 4 of the Income Tax (Concessionary Rate of Tax for SIMEX Members) Regulations is amended by deleting the words “regulation 3” in paragraph (a) and substituting the words “regulations 3 and 3A”.

[G.N. Nos. S 449/93; S 81/94; S 5/96]

Made this 18th day of April 1996.

NGIAM TONG DOW

Permanent Secretary,
Ministry of Finance,
Singapore.

[MF(R) R32.19.04 Vol. 13; AG/SL/10/95/1]