Singapore unveils tax breaks, visa reforms to boost fund management sector

Singapore's central bank and finance ministry have announced a package of measures aimed at strengthening the city-state's position as a global asset management hub. The initiatives, revealed on Wednesday, include tax exemptions on profits earned by fund managers and broader access to a long-term visa for investment professionals.

The Monetary Authority of Singapore (MAS) and the finance ministry plan to introduce tax relief on profits derived from managing certain funds, including those held by single family offices. Detailed provisions are expected to be outlined in the national budget next year.

National Development Minister Chee Hong Tat, who also serves as deputy chairman of MAS, said it was important to share these plans with the industry early. This would allow firms to factor Singapore's incentives into their decisions on where to base and expand operations.

The move comes amid intensifying regional competition. In July, the Alternative Investment Management Association cautioned MAS that Hong Kong's proposed tax breaks on performance bonuses for individual fund managers could widen the effective tax gap and make that city more attractive.

Alongside the tax measures, MAS and the manpower ministry will widen eligibility for the Overseas Networks & Expertise Pass. The pass, valid for up to five years, allows professionals to work for multiple companies simultaneously without reapplying when changing jobs.

MAS will also launch an investment programme targeting hedge funds committed to establishing or deepening their presence in Singapore, with further details to be announced later.

The initiatives build on a period of steady growth. According to MAS data, Singapore's asset management industry has expanded at an average annual rate of 7.5% over the past five years, reaching nearly S$7 trillion in assets.