Singapore business-lobbyist Pricewaterhousecoopers (PwC) today (Feb 3) called for the Singapore government to be more generous with tax rebates to “spur innovation”. PwC Singapore Chris Woo lobbied hard for the tax rebates via state media ChannelNewsAsia:
“Incentives could be broadened and focused on rewarding growth. Share options and stock award schemes can promote greater owner-entrepreneurial spirit.
To spur innovation, new ventures could be accorded a more liberal tax treatment of expenses to encourage businesses to develop innovative capabilities in this rapidly evolving economy. When introducing this, anti-abuse measures must continue to be taken into consideration.”
Using promotion of innovation and entrepreneurship as excuses, PwC Singapore called for the government to relax the R&D tax claims restrictions and enhance the PIC scheme. PwC Singapore also lobbied for easier access to bank loans by businesses, allowing them to use Intellectual Property as collateral.
PwC Singapore also lobbied hard for the extension of a tax-rebate scheme for investors called the “safe harbour rule”. According to the Singapore International Chamber of Commerce:
“The safe harbor rules introduced during the 2012 Budget stipulate that where investors hold at least 20% of the ordinary shares in an investee company for a continuous period of at least 24 months immediately prior to the sale, they would not be taxable on the gains from the sale of such ordinary shares.”
The Singapore government lost billions of taxes to date with generous tax rebates given to investors and businesses, which they recovered by taxing ordinary Singaporeans who do not invest or own a business. As taxation is a zero sum game, more tax rebates given to the rich will end up having the middle and low income workers having to pay for government programmes.
Unfortunately, the Singapore government has proven historically to bend backwards to business demands claiming that such tax rebates encourage job growth despite having no statistics to back up the claim.
This is not the first time PwC Singapore lobbied for the tax rebates. In Nov 2015, PwC Singapore Chris Woo lobbied for higher GST for the masses and lowering of business costs.
Accounting firm PwC lobby for lower business tax and higher GST