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Sep 8, 2007

Millionaires' ranks exceed 2,000 for the first time

Figure jumps to 2,121 for 2005 on strong economy and equities market, tax data shows

By Goh Eng Yeow

THE ranks of people in Singapore earning at least $1 million in a single year have grown to record levels, due to a buoyant economy and strong stock market.

The latest figures from the taxman show the number of these million-dollar earners crossed the 2,000 mark for the first time in 2005.

There were 2,121 of them at the end of that year, with 383 millionaires having joined the exclusive club.

That is an even bigger jump than the 368 new faces earning the magic seven-digit figure annually who joined the club during the heady days of 2000, when the stock market was caught up in a dot.com frenzy.

Most of the millionaires are residents here, meaning that they live in Singapore for at least 183 days a year. Only 31 are non-residents.

All in, they paid $682 million in taxes, or 14.5 per cent of all personal tax collected for income earned in 2005, or in the year of assessment 2006.

Data from the taxman also shows that takings of personal income tax, as at March 31 this year, rose to $4.7 billion. This is tax assessed on income earned in 2005 and paid the next year. This was up from $4.33 billion the year before. But given the strong economy, this is not surprising.

In 2005, the Straits Times Index surged 14 per cent, continuing an uptrend which started in 2003 when Singapore recovered from a number of body blows, such as Sars and the bursting of the dot.com bubble.

That year also saw the listing of 67 firms on the Singapore Exchange.

Data released by the Inland Revenue Authority of Singapore also shows that total taxes collected hit $22.86 billion in the year ended March 31, up 15 per cent from the year before.

Corporate tax made up the biggest slice of the pie, climbing to $8.48 billion from $7.34 billion.

The biggest corporate taxpayers came from companies in the wholesale and retail trades, which paid a total sum of $2.01 billion.

This was followed by firms in the financial sector, which paid $1.93 billion in taxes, and manufacturing companies with $1.72 million in tax bills.

Still, this is hardly surprising. Of the 374 listed companies with Dec 31 year-ends which reported results for 2005, 310 were profitable with just 64 in the red. These listed firms earned a staggering $19.96 billion, up 13.9 per cent.

The data also showed that the takings from other forms of taxes were also up for the period under review.

Collections from goods and services tax rose from $3.82 billion to $3.98 billion, while property tax takings were up from $1.83 billion to $2.01 billion.

engyeow@sph.com.sg