EXPATRIATES

Mr Tay Beng Chuan asked the Minister for Manpower (a) what are the current and projected numbers of expatriates working in Singapore; and (b) whether the Government will introduce any tax efficient pension scheme as an alternative retirement provision to the Central Provident Fund scheme for such expatriates, in line with its efforts to attract and retain international talent.

Dr Lee Boon Yang: (a) There are currently about 80,000 Employment Pass holders in Singapore, an increase of 20,000 as compared to that in 1995. We do not have detailed projection figures of expatriates. However, we would expect a higher demand for expatriates in the future. As Singapore evolves into a knowledge-based economy, our industries will restructure themselves to take on higher value-added activities that require a better skills profile. Therefore, there will be the urgent need for more international talents to meet this shortage.

(b) To attract and retain international talent, we must offer employment terms that are internationally competitive. Tax rates for expatriates working here are generally competitive. However, as such expatriates do not contribute to CPF, their effective rate of income tax is higher than that paid by citizens and permanent residents. MOM together with MOF is studying this, to see if there is any justification for allowing tax efficient pension schemes as the Member has suggested. LIST - SSTD SHAREHOLDERS (Cols. 1867-1870)