Singapore Parliament Introduces Finance Income Taxes Bill 2026

The Finance (Income Taxes) Bill (Bill No. 22/2026) was introduced in the Parliament of Singapore on 8 September 2026 and read a first time, published for general information in the Government Gazette Bills Supplement No. 22 of that date (Notification No. B 22). The Bill implements the tax changes announced in the Government’s 2026 Budget Statement, amending the Income Tax Act 1947, the Multinational Enterprise (Minimum Tax) Act 2024 and the Economic Expansion Incentives (Relief from Income Tax) Act 1967, with related amendments to the Goods and Services Tax Act 1993 and the Property Tax Act 1960.

Several provisions take effect retrospectively. Section 4(1)(d) is deemed to have come into operation on 1 May 2025, section 23 on 8 December 2025, and sections 14(1)(a) and (2), 38 and 49(b) on 1 January 2026. Sections 27, 28, 32 and 34 commence on 1 July 2027, while sections 37, 39, 49(d) and 50 take effect on a date the Minister appoints by notification in the Gazette.

Corporate tax rebate and cash grant

A new section 92M introduces a 50% corporate tax rebate for the year of assessment 2026, as announced in the 2026 Budget Statement and enhanced in the Ministerial Statement on the Impact of the Middle East Situation on Singapore of 7 April 2026. The rebate is the lower of 50% of tax payable or $40,000, each reduced by a $2,000 cash grant.

• A non-taxable $2,000 cash grant is paid to companies that made a Central Provident Fund (CPF) contribution for at least one local employee in calendar year 2025.
• The grant is withheld if the company is not carrying on a trade or business, is in liquidation, is in receivership, or has ceased to exist.
• The Comptroller may waive the CPF time requirement where it is just and equitable to do so.

New reliefs for AI, shipping and trade

A new section 14ZK allows a deduction for qualifying artificial intelligence expenditure for the years of assessment 2027 and 2028, applying a multiplier of 300% (where the expenditure is deductible under section 14) or 400% (otherwise) to the lower of $50,000 and the qualifying AI expenditure incurred. Qualifying expenditure covers subscription to or licensing of an AI system and qualifying AI business services, but excludes physical infrastructure and hardware.

• A new section 14ZL lets individuals claim a formula-based deduction for outgoings on trade, business, profession or vocation income, subject to a $50,000 gross-income threshold and an election to disapply.
• Section 13E is extended so that income of approved international shipping enterprises is exempt under that section rather than section 13A, with effect from the year of assessment 2027.
• The cap on double-deduction expenditure for unapproved firms and companies rises to $400,000 from the year of assessment 2027.

Multinational minimum tax and procedural changes

Part 2 amends the Multinational Enterprise (Minimum Tax) Act 2024 to implement the Side-by-Side Safe Harbour, part of the Side-by-Side package approved by the OECD/G20 Inclusive Framework on Base Erosion and Profit Shifting in January 2026, and the GloBE information return exchange framework under the Multilateral Competent Authority Agreement. The Minister is empowered to exempt responsible members of registered MNE groups from furnishing returns for multinational enterprise top-up tax and domestic top-up tax.

• The definition of “GIR” is widened to include equivalent foreign returns for a qualified UTPR, qualified domestic minimum top-up tax, MTT or DTT.
• The Comptroller may require a designated local GIR filing entity to file a return if the foreign competent authority does not transmit it in time.
• Secrecy obligations are relaxed to allow disclosure to competent authorities under the MCAA.

The Bill also aligns appeal timelines across the tax statutes, extending the notice-of-hearing period from 14 to 35 days and requiring appeals to the General Division of the High Court to be filed within 28 days. The Bill will involve the Government in extra financial expenditure, the exact amount of which cannot at present be ascertained.

For taxpayers and multinational groups, the Bill is the principal annual vehicle for Singapore’s income tax policy, combining a one-off corporate rebate and cash grant with new incentives for AI adoption and international shipping, while aligning the domestic minimum-tax regime with the OECD’s global framework.

Source: Republic of Singapore Government Gazette, Bills Supplement No. 22, 8 September 2026, Notification No. B 22 (official reference: Bill No. 22/2026).