Singapore is planning a fresh set of tax and visa incentives to strengthen its asset management industry and stay competitive with Hong Kong. The Monetary Authority of Singapore (MAS) and the finance ministry will introduce tax exemptions on investment profits earned by fund managers managing certain funds, including single family offices.

The government also plans to make it easier for investment professionals to access Singapore's Overseas Networks & Expertise Pass, which is valid for up to five years before renewal and allows holders to work for multiple companies.

More details on the planned tax measures are expected to be announced in the 2027 budget. MAS will also support hedge funds that are committed to establishing or expanding their presence in Singapore through an investment programme.

The move comes as competition between Singapore and Hong Kong, two of Asia's major financial centres, continues to grow. Hong Kong is also working on expanding tax-free carried-interest measures to a wider range of fund houses and individual fund managers, aiming to attract more investment funds and financial talent.

The developments have raised concerns among Singapore-based funds that the growing tax gap could make Hong Kong more attractive to investment professionals. The Alternative Investment Management Association (AIMA) had warned MAS in July that Hong Kong's proposed tax benefits for individual fund managers could increase its appeal.

National Development Minister Chee Hong Tat, who is also deputy chairman of MAS, said it was important to provide the industry with clarity on the government's plans as companies consider where to locate and expand their businesses.

Kher Sheng Lee, AIMA's Asia-Pacific co-head, said the speed of Singapore's response had caught the attention of investors and added that the measures could strengthen the country's position in attracting managers, talent and capital.

MAS has also held discussions with hedge funds in recent months to understand their requirements and preferred tax rates. Singapore's asset management industry has grown at an average rate of 7.5% annually over the past five years, reaching nearly S$7 trillion, according to MAS data. The latest measures highlight Singapore's efforts to remain an attractive base for fund managers and investment professionals as competition with Hong Kong intensifies.