Neil Parekh Nimil Rajnikant on Income Tax (Amendment) Bill and Multinational Enterprise (Minimum Tax) Bill

Two Bills being debated in Parliament on Tuesday (Oct 15) “present significant opportunities” for Singapore, said NMP Neil Parekh Nimil Rajnikant. He said the Income Tax (Amendment) Bill incentivises investment in key sectors while the Multinational Enterprise (Minimum Tax) Bill ensures fair competition by requiring MNEs to pay their fair share while creating a stable tax environment. The minimum tax rate for MNEs will also help Singapore protect its tax base by closing loopholes that allow profit-shifting to low-tax jurisdictions. Meanwhile, aligning Singapore with global tax practices will strengthen the country’s reputation as a transparent, ethical and business-friendly hub. Yet challenges may arise for businesses, especially SMEs, said Mr Parekh. He sought clarification in several areas, such as how businesses currently benefiting from existing tax incentives will be affected by the changes, how the new regulations gel with Singapore’s existing global tax agreements, what penalties will be imposed on businesses that fail to meet compliance requirements, and what support SMEs will receive to manage the costs and administrative challenges in transitioning to the updated tax framework.