Singapore legislation
Section 37
of Economic Expansion Incentives (Relief from Income Tax) Act
Section 37
Computation of export profits
(1)
The income of an export enterprise in respect of its trade or business to which its export enterprise certificate relates shall be ascertained (after making any necessary adjustments in consequence of a direction under section 9, as applied to this Part by section 33) for any accounting period during its tax relief period in accordance with the provisions of the Income Tax Act (Cap. 134), before taking into account the allowances provided for in sections 16, 17, 18, 19, 19A, 20, 21 and 22 of that Act.
(2)
The total export profits of an export enterprise shall be deemed to be that part of the income so ascertained which bears the same proportion to that income as the total value of the export sales (f.o.b.) of its export product or export produce whether made, directly or indirectly, by sale to an independent exporter (referred to in this Part as the export sales) bears to the total value of the sums receivable in respect of —
its domestic sales of manufactured products or produce at ex-factory prices;
its export sales (f.o.b.) of its export product and export produce;
its export sales (f.o.b.) of other products; and
all other sales and provisions of service,(referred to in this Part as the total sales).
(3)
Where a company exports any products or produce to which its export enterprise certificate relates, the amount of its export profit arising from the export of those products or produce which will qualify for the relief provided by section 39 is the excess of that profit over a fixed sum to be determined in the following manner:
in the case of a company which has previously exported those products or produce, the average annual export profit of the company shall be ascertained in the manner provided by subsection (4); and
in the case of a company which has not prior to its application under section 30 exported those products or produce for 3 years immediately preceding its application, the fixed sum shall be such an amount as the Minister may determine having regard to the total sales of the company and the percentage of the total sales of other major export enterprises exporting like articles.
(3A)
Where such a company is a pioneer enterprise, subsection (3) shall apply notwithstanding that the company was deemed to commence a new trade or business at the end of its tax relief period as a pioneer enterprise.
(4)
For the purposes of this section —
“average annual export profit” means a sum equal to one-third of the total export profits of the company from the export of those products or produce ascertained in the manner provided by subsection (2) during the 3 years immediately preceding the date of its application under section 30; and
where a company has adopted an accounting period ending on a date other than 31st December, the Comptroller may make such adjustment on a time basis as appears to him to be reasonable in ascertaining the total export profits of that period.