Other Briefings
Cambodia Raises its Income Tax Threshold
At the beginning of January, Cambodia reduced the income tax burden on workers in the country. The government has raised its tax threshold from 500,000 riel (US$125) to 800,000 riel (US$200). The previous lowest income tax bracket had begun at 500,000 riel, at a rate of five percent. This change puts approximately US$3.75 a month back into the pockets of workers in Cambodia earning over US$200 per month.
Changes to Singapore Transfer Pricing Guidelines
On 6th January 2015, the Inland Revenue Authority of Singapore (“IRAS”) released revised transfer pricing guidelines.
Philippines the First ASEAN Country to Join the EU’s General System of Preferences Plus (GSP+)
On December 18, 2014, the European Parliament officially granted the Philippines’ request for inclusion in the European Union’s (EU) General System of Preferences Plus (GSP+). The Philippines will soon be able to export, tariff-free, over 6,200 products (66 percent of all product tariff lines) to the EU, including processed fruit, coconut oil, footwear, fish, and textiles.
Singapore Signs IGA on FATCA with the United States
On December 9, 2014, Singapore became the first country in Southeast Asia to sign an Intergovernmental Agreement (IGA) on tax information sharing with the United States. The signing follows an in substance agreement reached between Singapore and the US in May 2014. Most countries around the world have been entering into IGAs with the US government since the US introduced a complex reporting and withholding regime through the passage of the Foreign Accounts Tax Compliance Act (FATCA) in March 2010.
Cambodian Government Preparing Standardized Tax Reports
The Cambodian Ministry of Economy and Finance is drafting standardized accounting procedures for small and medium-sized businesses. The main goal of the draft is to streamline bookkeeping, improve tax collection efforts for the government, and make it easier for lending institutions to evaluate loans.
Singapore to Reduce Property Taxes for HDB Flats
The Singaporean government has announced a range of property tax and other cost reductions for those living in Housing and Development Board (HDB) flats. Starting January 1, 2015, HDB flat owners of three-, four-, and five-room units will see a three percent reduction in their annual rent. Additionally, owners of one-room and two-room HDB flats will continue to pay no property tax. This will be the second year that the Inland Revenue Authority of Singapore (IRAS) has imposed progressive property tax reductions in order to reflect the cooling down of the property market – a slowdown mainly due to government intervention.
Thailand Postpones VAT Hike
Thailand’s Prime Minister Prayut Chan-o-cha announced the postponement of the country’s proposed value-added tax (VAT) hike on December 2, 2014, citing unfavorable economic conditions. Thailand’s growth forecasts have been downgraded by ANZ’s Roy Morgan from 1.3 percent to 0.9 percent for 2014, and from 4.8 percent to 4.2 percent for 2015.
ASEAN Tax and Regulatory Update
In this article we highlight some of the recent tax and regulatory actions taken in the ASEAN region. The importance of ASEAN continues to grow, with 2015 set to see the implementation of the ASEAN Economic Community (AEC). The AEC seeks to “transform ASEAN into a single market and production base, a highly competitive economic region, a region of equitable economic development, and a region fully integrated into the global economy.” Collectively, ASEAN represents a market of some 600 million people, with a combined GDP of about US$2.5 trillion and upwards of US$1.5 trillion in trade flowing throughout the region.
Singapore Releases New e-Tax Guide for Business Trusts
The Inland Revenue Authority of Singapore (IRAS) has released a new e-tax guide which provides details on the income tax treatment of trusts registered under the Business Trusts Act, applicable to both trustee-managers and unit-holders.
Malaysia to Implement Lowest ASEAN Goods and Services Tax (GST)
Beginning in April 2015, Malaysia will introduce a goods and services tax (GST) of six percent – the lowest rate in the ASEAN region. The new GST will replace the country’s current sales and services taxes. 2015 will also see the release of Malaysia’s new budget.
The new tax regime is intended to increase the competitiveness of Malaysia’s exports, which will be zero rated. Additionally, a number of special schemes will be implemented in order to support the cash flow of exporters – such as, allowing companies to defer accounting for GST on temporarily imported goods for re-export.
