Amended Bill Encourages Investment in Energy Efficiency

The Singapore Government has given a tax incentive to energy-efficiency projects.

Energy efficiency projects have now been included in the qualifying list of activities under Singapore’s Investment Allowance Scheme.

Investment Allowance incentivises capital investments by providing companies an offset against their taxable incomes.

Senior Minister of State for Trade and Industry, S Iswaran, explained:

"Energy efficiency is also an important component in our efforts to reduce national greenhouse gas emissions. However, high capital costs and long pay-back periods can discourage energy efficiency investments.

"The amendment therefore aims to encourage more investments in energy efficiency projects by companies in Singapore."

Investment Allowance is part of Singapore’s Economic Expansion Incentives Act, which was amended in Parliament on Monday.

The amendments are looking to extend the maximum period within which fixed capital expenditure in hire-purchase transactions can qualify for investment allowance. The new limit from this amendment would be eight years, three years more than the current ceiling.

"It has been assessed that it is not uncommon that companies, especially small and medium enterprises, carrying out fixed capital expenditure through hire-purchase transactions can do so over a hire-purchase period of up to eight years," Iswaran added.

Picture by StarvingFox

Tuesday 23rd November 2010

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