Parliament
Lawrence Wong declines to quantify tax incentives, citing limits of data and economic necessity
Prime Minister Lawrence Wong declined to estimate tax revenue losses due to concessionary corporate tax rates in response to WP MP Louis Chua’s question, citing that these incentives, aimed at attracting investment, cannot be quantified with certainty. His answer sidestepped the specific data requested.
In a written response to Workers’ Party Member of Parliament (MP) Louis Chua during the parliamentary session on Monday (11 Nov), Prime Minister Lawrence Wong refrained from providing an estimate of Singapore’s annual tax revenue foregone due to concessionary corporate tax rates.
Mr Chua’s question had specifically asked for the estimated annual amount of forgone corporate income tax revenues over the past five years, calculated by comparing the effective tax rates of companies receiving these incentives with both the average effective corporate tax rate and the statutory corporate tax rate.
In his response, Mr Wong, who is also the Finance Minister, explained that Singapore, like many jurisdictions, uses tax incentives selectively to compete for investments that, he claimed, ultimately benefit the economy.
Mr Wong emphasised that these incentives are not automatically granted to all companies investing in Singapore; rather, they are offered only when economic agencies assess that the incentive is crucial to securing the investment.
He noted that the financial value of these incentives is only a fraction of the projected total investment value and that each incentive is carefully evaluated to maximise economic benefits.
“Tax revenue forgone from these tax incentives is notional,” Mr Wong stated, explaining that it would be incorrect to assume that Singapore’s tax base would remain unchanged without these incentives, implying that the tax benefits help secure investments that might not occur otherwise.
However, Mr Wong did not address Mr Chua’s request for specific figures or comparisons, focusing instead on justifying the policy’s economic rationale.
In a previous parliamentary session in May 2023, Progress Singapore Party Non-Constituency Member of Parliament (NCMP) Leong Mun Wai—in an adjournment motion—had argued that the government should supply all data requested by MPs, unless there are pressing concerns over national security or market sensitivity.
Mr Leong argued that withholding data due to potential misinterpretation or misuse restricts fair debate in Parliament, urging a more transparent approach.
Leader of the House Indranee Rajah responded to Mr Leong by underscoring that productive debate depends on recognising practical constraints, rather than pursuing extensive data requests for their own sake.
She noted that in the last session alone, the government had answered over 7,000 parliamentary questions, many of which involved providing detailed data. She also pointed out that Minister for Manpower Tan See Leng echoed this sentiment, explaining that data collation, verification, and formatting require significant time and resources, which must be managed efficiently.
Despite this commitment to data provision, Mr Wong’s response to Mr Chua’s question notably lacked the specific revenue figures requested.
His reply thus highlights a continuing tension over data transparency, particularly with MPs such as Mr Chua and Mr Leong, who advocate for access to more granular data on topics such as public spending and tax incentives.
The government, however, maintains that it must balance transparency with practicality, releasing data it deems reasonable for policy discussion without overextending resources.
As a result, Mr Wong’s response arguably does not fall within the “7,000 questions” cited by Ms Indranee, where data was substantively provided.
Mr Wong’s reply instead sidestepped Mr Chua’s question, leaving the specific details on forgone revenue unaddressed.
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