Govt revenue in FY2024 lifted by various taxes; Budget surplus of $6.4b

Firms paid more corporate income tax, the single largest contributor to total revenue

- Claire Huang

Singapore's national coffers have been boosted by better-than-expected revenue in fiscal year (FY) 2024, led by the jump in corporate income tax, Prime Minister and Finance Minister Lawrence Wong said in his Budget speech on Feb 18.

The Ministry of Finance (MOF) said firms paid more in corporate income tax, which was up 6.5 per cent year-on-year to $30.9 billion in FY2024. This is up from the estimated $28 billion.

The higher collection helped improve Singapore's fiscal position, from an overall Budget deficit of $2.6 billion in FY2023 to a surplus of $6.4 billion in FY2024, which is about 0.9 per cent of gross domestic product (GDP).

Corporate income tax collection is estimated to hit 4.1 per cent of GDP in FY2024, higher than the usual 3.2 per cent in past years.

PM Wong said the larger amount of corporate income tax collected is due to several reasons, including industry-specific cyclical factors in finance and wholesale trade, as well as possible changes in investment decisions of multinational enterprises as they seek stable centres like Singapore for their high-end activities.

Calling it an unexpected change, he said corporate income tax is now the single largest contributor to total revenue, even higher than the Net Investment Returns Contribution (NIRC), which came in at $24 billion in FY2024. In FY2023, it was $23 billion.

Another key contributor to revenue was the amount collected in goods and services tax (GST) that rose 23.8 per cent year-on-year to $20.6 billion in FY2024. MOF said this was due to stronger-than-expected growth in private consumption.

PM Wong said that in this term of government, several changes were made to Singapore's tax system, including the GST rate increase.