POST OFFICE SAVINGS BANK (Commercialization)

[Mr Speaker in the Chair]

Mr Rohan bin Kamis asked the Minister for Finance, in view of the Post Office Savings Bank having more than two million savings accounts, what is the impact of the proposal of POSB going commercial on the account holders with regard to the tax exempt interest and if the Minister will provide details of the new scheme.

The Minister for Finance (Mr Hon Sui Sen): Mr Speaker, Sir, the tax-exempt status of interest on POSB deposits has been under review in the light of the plan to convert POSB into a commercial bank. The review is being undertaken by a Steering Committee, appointed to prepare the blueprint for commercialization. It has been addressing the question of the tax- exempt status as part of its terms of reference.

The Steering Committee is expected to submit its report to the Ministry of Finance in April 1983.