SINGAPORE: A more progressive tax structure will be introduced for properties and cars to achieve greater social equity without hurting Singapore’s competitiveness.
The zero per cent property tax rate band, which currently applies to the first S$6,000 of annual value of properties will be widened to S$8,000.
Currently, property tax rates for owner—occupied residential property are at zero per cent, four per cent and six per cent, depending on the annual values of the properties.
In addition to the current four per cent and six per cent tax bands, the government will introduce new bands of eight per cent to 16 per cent.
Deputy Prime Minister Tharman Shanmugaratnam, who announced these changes in his Budget Statement on Monday, said 950,000 owner—occupied residential properties will be able to enjoy some tax savings.
High—end investment properties will also see significant increases in tax rates.
New marginal property tax rates of 12 per cent to 20 per cent will be introduced, in addition to the current 10 per cent.
As for passenger cars and taxis, there will be a new tiered Additional Registration Fee (ARF) structure.
The ARF for car models with an Open Market Value of more than S$20,000 will be 140 per cent.
Any value beyond S$50,000 will attract an ARF rate of 180 per cent.
The changes will apply to vehicles registered with Certificates of Entitlement obtained from the first bidding exercise in March 2013.
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