PAP to cut corporate tax rate (for the rich)

Singapore is prepared to cut its corporate tax rate to remain competitive in the global race for investments, Prime Minister Lee Hsien Loong was quoted by local media as saying.

Mr Lee said Singapore might have to adjust its current 20 per cent corporate tax rate if Hong Kong moved to lower its own 17.5 per cent rate, the Straits Times reported.

Mr Lee made the comments in parliament on Monday, where he also revealed plans to raise the Goods and Services Tax (GST) to 7 per cent from the current 5 per cent.

The Hong Kong government has proposed a GST to broaden its tax base, and says reductions in income or profits tax, or even both, would accompany any introduction of such a tax. But it is facing mounting public opposition to its plan.

"Hong Kong is competition for us," he said. "If they do a GST, they may decide to bring their corporate tax down. We may have to follow them down." - NZ