“Budget 2017 is an opportunity to take stock of existing tax legislation to encourage businesses to put growth at the top of their agenda and ease business costs - whether by tweaking their business models, going overseas or through mergers and acquisitions,” said Chung-Sim Siew Moon, head of tax services at Ernst & Young Solutions.
The firm also said that the government should consider extending the Productivity and Innovation Credit (PIC) scheme to further enhance deductions on employee training expenses by giving companies the option to convert qualified training deductions into a non-taxable cash benefit.
Additionally, they recommended making all foreign-sourced income permanently exempt from taxes so as to encourage businesses “to grow beyond Singapore”.
“In the long run, it can boost Singapore's position as a launch pad for new industries with base operations in Singapore, including digital service sectors such as media, travel, FinTech and gaming,” said Chung-Sim.
The firm also said that enhancing tax deductions or introducing tax incentive schemes should be introduced to further enhance workers’ health and wellbeing.
“To continue encouraging the adoption of work-life practices, the government can consider further reliefs such as allowing individual taxpayers to claim a tax deduction for costs incurred in running a home office, if these costs are not reimbursed by employers,” said Kerrie Chang, partner, people advisory services.
“The government can also consider an enhanced allowance for the acquisition or leasing of IT equipment for flexible work arrangement purposes,” said Chang.
“A double or further tax deduction can also be considered for consultancy fees incurred on the job and performance measurement redesign and IT system design" she said.
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Business advisory firm Ernst & Young Solutions has urged the government to provide further tax relief for employee well-being and training initiatives, ahead of the budget announcement next month.