CENTRAL PROVIDENT FUND CONTRIBUTIONS (Income tax relief)

Mr Ng Kah Ting asked the Minister for Finance (a) how many taxpayers in the years 1975 to 1977 did not receive reliefs from income tax for sums in excess of $4,000 paid by them in respect of Central Provident Fund contributions and life assurance premiums; and (b) if the CPF contributions of a taxpayer exceed $4,000, will the Minister consider allowing income tax relief for the full amount contributed.

Mr Goh Chok Tong (for the Minister for Finance): Mr Speaker, Sir, the total number of taxpayers who enjoyed the maximum relief of $4,000 a year in respect of CPF contributions and life assurance premiums were 5,700 for 1975, 9,689 for 1976 and 12,665 for 1 977. They represent 2.6%, 4.0% and 4.5% of the total number of taxpayers for the three years respectively.

The ceiling of $4,000, as I have indicated in my earlier reply, is already generous. Moreover, the CPF member does not suffer income tax on his employer's contributions to CPF on his behalf whatever the amount. I would also draw attention to the income tax reductions in this year's Budget Statement which, in absolute terms, benefit most those taxpayers paying more than $4,000 into the CPF. In view of this, we do not intend to grant further relief to these taxpayers as suggested by the Member for Punggol.