Leasing From the Singapore Public

In its effort to tap into the ship financing sector, driven by an estimated $300 billion worth of financing for newbuildings and acquisition, the Maritime and Port Authority of Singapore (MPA) instituted a generous Maritime Finance Incentive (MFI) scheme. Possibly the most important feature of this scheme is the tax exemption on qualifying income for the entire life of any vessel acquired by an Approved Ship Investment Vehicle (ASIV) within its incentive period. In addition, for Appoved Ship Investment Managers (ASIM) the corporate tax rate is reduced from 20% to 10% The intention was to increase the attractiveness of such investments to potential investors and spur ship investment management companies to set up such investments in Singapore.

The target audience for the MFI scheme are ship leasing companies, shipping funds or shipping business trusts that provide financing for all types of vessels, with tax exemptions on qualifying income derived by ASIVs from ship leasing activities to non-tax residents of Singapore, the leasing of vessels registered with the Singapore Registry of Ships, and the leasing of foreign-flagged vessels operated by companies under the Approved International Shipping Enterprise Scheme.

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