Singapore: ABSD duties deter foreign buyers

On top of ordinary stamp duty, Singapore levies an additional duty whose rate depends on the buyer's status — citizen, permanent resident or foreigner — and on how many properties they already own.

The rate applicable to foreign buyers is the highest of all, and it has been raised several times. The aim is not to raise revenue but to moderate demand in a market constrained by the country's small size.

We do not publish the rate of these additional duties or the dates of their successive increases: we were unable to verify them in an up-to-date official Singaporean source. They must be confirmed with the Inland Revenue Authority of Singapore before any purchase.

What can be said is that the level reached makes the transaction economically pointless for a foreign investor seeking rental yield: the duty paid on entry absorbs several years of net rent.

Some free trade agreements concluded by Singapore provide for national treatment for nationals of a few states, who then escape the foreigner rate. France is not one of them.

It should be noted that these duties are payable on acquisition, on the price or on the market value if higher. They are neither spread out, nor recoverable, nor deductible from a later capital gain: they are a dead loss from day one, which explains their deterrent effect.

Singapore pursues a housing policy in which public housing, which makes up the large majority of the stock, is reserved for citizens and permanent residents. The private market, the only one open to foreigners, is the residual portion.

This structure explains the political sensitivity of the subject. Any foreign pressure on the private segment immediately feeds through to prices, in a city-state where land cannot expand.

Landed houses are also subject to prior approval for foreigners, on top of the additional duties. Access to this segment is closed in practice.

An expatriate settling in Singapore therefore rents in the vast majority of cases. Buying only makes sense for a permanent resident or a citizen, and this is a criterion to factor into the expatriation decision itself.

Singapore's tax appeal remains intact for income and financial assets. Gains on the disposal of property, shares and financial instruments are not taxed, at a rate of 0%¹.

The personal tax scale ranges from 0%² to 24%³, and corporate income tax is set at 17%⁴.

In other words, Singapore taxes local property heavily and everything else lightly. This is consistency, not contradiction: the jurisdiction protects its scarce resource and lets mobile capital flow.

For an investor, the practical consequence is clear: Singapore is a place to manage wealth, not a market for buying bricks and mortar.

1. Check the current rate of the additional duties with the Singaporean tax authority.
2. Check whether a free trade agreement grants national treatment: this is not the case for France.
3. When settling there, favour renting: buying only makes sense with permanent resident status.
4. Do not confuse property taxation, which is heavy, with the taxation of financial capital, which is very light.
5. Keep an eye on the 183 days⁵ threshold, which determines Singaporean tax residency.

One last point is worth noting for the future. Several highly sought-after jurisdictions — Canada, New Zealand, Australia, and now several European countries — have adopted comparable measures, ranging from surcharged duties to outright bans. Singapore was simply among the first, and its example is now being followed. An international property investor must now treat this regulatory risk as an ordinary parameter of their analysis.