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Other fiscal measures and initiatives

Measures to boost corporate focus on social initiatives

The Budget also provides measures to continue supporting philanthropy and volunteerism to ensure the vulnerable and needy groups in society are cared for, given they are hit much harder by the economic fallout from the pandemic. Non-tax measures to enhance enterprise capabilities and workforce development were also announced.

Extension of Not-for-Profit Organisation tax incentive

The Not-for-Profit Organisation (NPO) tax incentive scheme, scheduled to expire on 31 March 2022, has been extended to 31 December 2027. It provides an attractive proposition for foreign NPOs to set up their operations here, with a comparable tax position as in their home jurisdictions, given these NPOs are likely tax exempt entities. The measure should position Singapore well as a hub for philanthropic activities in the region.

The scheme was introduced in Budget 2007 to attract NPOs which are potential multipliers for further economic value to Singapore. Under the scheme, qualifying NPOs are granted tax exemption on their income for an initial period of up to 10 years. The incentive is renewable subject to approval.

Extension of enhanced 250% tax relief for qualifying donations

Singapore taxpayers who make qualifying donations to Institutions of a Public Character (IPCs) and other qualifying recipients from 1 January 2016 to 31 December 2021 are currently eligible for a 250% tax deduction. This enhanced tax deduction has now been extended to 31 December 2023.

The COVID-19 pandemic has increased the needs of the vulnerable and deserving causes in Singapore. The extension of this popular tax relief scheme should encourage sustained donations by both corporate and individual taxpayers. While the extension of the tax relief is certainly welcomed, one would hope that this can be made a permanent feature of our tax system since this is an important policy tool to encourage philanthropy.

Extension of the Business and IPC Partnership Scheme

The Business and IPC Partnership Scheme (BIPS) was due to expire on 31 December 2021, but it has now been extended to 31 December 2023, with all other conditions remaining the same. This extension is welcome as the scheme provides greater flexibility for businesses to choose to support IPCs in the manner that best meets their needs, be it in cash or via in-kind services.

Under BIPS, businesses sending employees to volunteer or provide services to IPCs, including through secondments, can enjoy a 250% tax deduction on qualifying expenditure.

The qualifying expenditure, including basic wages and other related expenses, is capped at:

  • $250,000 per business per Year of Assessment (YA); and
  • $50,000 per IPC per calendar year.

The Budget also contains various other measures that seek to strengthen our community, workers and businesses. Some of these include:

  • Extending the additional support for Tote Board’s Enhanced Fund-Raising Programme by one year.
  • Extending ComChest’s SHARE as One matching period to 2023.
  • Introducing the Change for Charity Grant to promote spontaneous giving.
  • Matching three dollars for every dollar raised for the CDCs’ Care and Innovation Fund to support innovative initiatives which address community needs.
  • Introducing the Growth and Transformation Scheme for the Built Environment sector as part of the industry transformation map.
  • Introducing the Innovation & Enterprise Fellowship Programme to groom leaders in areas such as cybersecurity, artificial intelligence and health technology.
  • Introducing the Agri-Food Cluster Transformation Fund to support technology adoption in the agri-food sector.
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