Singapore Budget 2023 and beyond

Other key changes announced

• Philanthropy Tax Incentive Scheme for Family Offices

  • A new tax incentive scheme has been introduced for philanthropic donations that do not otherwise rank for tax deduction. It applies to qualifying donors with Family Offices based in Singapore that operate a fund that qualifies for tax incentives under either section 13O or 13U of the ITA.
  • Qualifying donors can claim a 100% tax deduction for donations made through qualifying local intermediaries
  • The deduction is capped at 40% of the donor’s statutory income
• Extension of the 250% Tax Deduction for Qualifying donations to Institutions of a Public Character and eligible institutions

  • Scheduled to end on 31 December 2023. It has been extended to 31 December 2026.
  • All other conditions of the scheme remain the same.
• Increase in BSD for higher-value residential and non-residential properties

  • The current BSD rates range from 1% to 4% for residential property and from 1% to 3% for non-residential property.
  • For residential properties, a new marginal BSD rate of:
    • 5% will apply to the portion of the property value in excess of SGD 1.5 million and up to SGD 3 million; and
    • 6% will apply to the portion of the property value in excess of SGD 3 million
  • For non-residential properties, a new marginal BSD rate of:
    • 4% will apply to the portion of the property value in excess of SGD 1 million and up to SGD 1.5 million; and
    • 5% will apply to the portion of the property value in excess of SGD 1.5 million

  The increased rates will apply to all properties acquired on or after 15 February 2023.

• ARF charges and PARF rebates

  • In the 2022 Singapore Budget a 4th tier of OMV for calculating ARF was introduced. Cars with an OMV exceeding SGD 80,000 were subject to 220% ARF.
  • In the current year, the bands of OMV have been reduced, creating a 5th tier of OMV for calculating ARF. Cars with OMVs exceeding SGD 80,000 are now subject to a 320% ARF.
  • This applies to vehicles registered with COEs obtained from the 2nd bidding exercise in February 2023 onwards. Otherwise, it applies to cars registered on or after 15 February 2023.
  • PARF rebates are calculated as a percentage of ARF based on the age of the vehicle at deregistration. This is now capped at SGD 60,000. It applies to vehicles registered from the second bidding in February 2023.