Income Tax (Exemption of Interest and Other Payments for Economic and Technological Development) (No. 2) Notification 2007

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No. S 661

Income Tax Act

(Chapter 134)

Income Tax (Exemption of Interest and Other Payments for Economic and Technological Development) (No. 2) Notification 2007

In exercise of the powers conferred by section 13(4) of the Income Tax Act, the Minister for Finance hereby makes the following Notification:

Citation and commencement

1. This Notification may be cited as the Income Tax (Exemption of Interest and Other Payments for Economic and Technological Development) (No. 2) Notification 2007 and shall be deemed to have come into operation on 15th February 2007.

Definitions

2. In this Notification —

“Authority” means the Monetary Authority of Singapore established under section 3 of the Monetary Authority of Singapore Act (Cap. 186);

“financial derivatives” means derivatives the payoffs of which are linked, whether in whole or in part, to the payoffs or performance of any financial assets, securities, financial instruments or indices, but does not include derivatives the payoffs of which are linked wholly to the payoffs or performance of commodities;

“financial institution” means any institution licensed or approved by the Authority, or exempted from such licensing or approval under any Act administered by the Authority, and includes an approved Finance and Treasury Centre referred to in section 43G of the Act;

“related party” has the same meaning as in section 13(16) of the Act.

Exemption

3.—(1) There shall be exempt from tax any payment made by a financial institution to a person who is neither resident in Singapore nor a permanent establishment in Singapore —

(a)

on over-the-counter financial derivatives, where the payment is liable to be made during the period from 20th May 2007 to 19th May 2012 (both dates inclusive) under —

(i)	a contract for such derivatives which took effect before 15th February 2007; or
(ii)	a contract for such derivatives which is extended or renewed, where the extension or renewal took effect before 15th February 2007; and

(b)

on over-the-counter financial derivatives, where the payment is liable to be made under —

(i)	a contract for such derivatives which takes effect during the period from 15th February 2007 to 19th May 2012 (both dates inclusive); or
(ii)	a contract for such derivatives which is extended or renewed, where the extension or renewal takes effect during the period from 15th February 2007 to 19th May 2012 (both dates inclusive).

(2) The exemption shall be subject to —

(a)	such conditions as may be imposed by the Minister;
(b)	such declaration (in relation to transactions by institutions that are exempted from licensing or approval under any Act administered by the Authority) as may be required by the Comptroller or the Authority for the purpose of this Notification; and
(c)	such declaration (in relation to transactions with related parties) as may be required by the Comptroller or the Authority for the purpose of this Notification.

Made this 23rd day of November 2007.

TEO MING KIAN

Permanent Secretary,
Ministry of Finance,
Singapore.

[R32.12.0006.V19; AG/LEG/SL/134/2005/8 Vol. 1]