The Land Betterment Charge Bill (“Bill“) was passed in Parliament on 10 May 2021. The Bill provides for the imposition of a tax (called a Land Betterment Charge or “LBC“) on the increase in the value of land resulting from a chargeable consent given in relation to land.
Under the existing framework, landowners and developers currently have to pay either a Development Charge, Temporary Development Levy or a Differential Premium to either the Urban Redevelopment Authority or the Singapore Land Authority (“SLA“) where there is an enhancement in land value for various reasons. The LBC would replace the DC, TDL and DP and would be payable to a single entity, consolidating these charges and taxes under SLA. The principles for computing LBC and the proposed rates of charging remain largely unchanged from the current regime.
The Bill sets out the framework for the operation of the LBC, including the rules for calculating the appliable tax, who is liable for payment, and how the obligation is to be satisfied and enforced. In this Update, we highlight the key features of the Bill and the LBC regime and how it differs from the current regime, as well as what developers should be aware of regarding their liability for payment of LBC.
For more information, click here to read the full Legal Update.
