Statute Details
- Title: Income Tax (Approved Banks) (No. 7) Order 1997
- Act Code: ITA1947-S453-1997
- Type: Subsidiary Legislation (sl)
- Authorising Act: Income Tax Act (Chapter 134)
- Authorising Power: Section 13(9) of the Income Tax Act
- Enacting Formula: Minister for Finance makes the Order in exercise of powers under section 13(9)
- Commencement / Effective Date: 16 October 1997 (for the approved bank designation)
- Key Provisions (from extract):
- Section 1: Citation
- Section 2: Approval of a bank as an “approved bank” for purposes of section 13(1)(t) of the Income Tax Act
- Approved Bank (Section 2): Chang Hwa Commercial Bank Ltd
- Made Date: 26 September 1997
- Legislative Reference: SL 453/1997
- Status: Current version as at 27 March 2026 (per the extract)
What Is This Legislation About?
The Income Tax (Approved Banks) (No. 7) Order 1997 is a short piece of Singapore tax subsidiary legislation. Its practical function is to designate a specific financial institution—Chang Hwa Commercial Bank Ltd—as an “approved bank” for the purposes of the Income Tax Act. In other words, it is not a broad tax reform measure; rather, it is an targeted administrative/legal instrument that triggers particular tax treatment under the Income Tax Act for the bank that is named in the Order.
In plain language, the Order answers a specific question: which bank qualifies as an “approved bank” under section 13 of the Income Tax Act? The Income Tax Act contains various provisions that can apply differently depending on whether an entity meets statutory criteria. This Order forms part of that framework by formally approving a bank and specifying the effective date from which the approval applies.
Although the extract is brief, the legal significance is substantial. Being designated an “approved bank” can affect how certain tax computations or exemptions are applied under section 13(1)(t) of the Income Tax Act. For practitioners, the key is to connect the Order to the underlying substantive tax provision in the Income Tax Act and to confirm the effective date and scope of the approval.
What Are the Key Provisions?
Section 1 (Citation) is a standard provision that states the short title of the instrument: “Income Tax (Approved Banks) (No. 7) Order 1997.” While it may appear procedural, citation provisions matter for legal certainty, especially when multiple similar “approved banks” orders exist over time (e.g., different “No.” numbers for different banks or different approval rounds).
Section 2 (Approved bank) is the substantive core of the Order. It provides that Chang Hwa Commercial Bank Ltd is approved as an “approved bank” for the purposes of section 13(1)(t) of the Income Tax Act. The Order also specifies the effective date: “with effect from 16th October 1997.” This effective date is crucial for tax practitioners because tax consequences typically depend on whether the relevant status existed at the time the relevant income or transaction is assessed.
From a compliance and advisory perspective, the wording “for the purposes of section 13(1)(t) of the Act” indicates that the approval is not necessarily a general label for all tax provisions. Instead, it is tied to a particular statutory hook in the Income Tax Act. Practitioners should therefore read section 13(1)(t) carefully to determine what tax treatment is triggered—such as whether it relates to deductions, exemptions, or special treatment of certain income streams or banking-related activities.
Enacting power and ministerial action are also important. The Order is made “in exercise of the powers conferred by section 13(9) of the Income Tax Act.” This confirms that the Minister for Finance has delegated authority to approve banks through subsidiary legislation. For lawyers, this matters when assessing validity, scope, and potential challenges: the approval mechanism is grounded in an express statutory power, which supports the legal enforceability of the designation.
Finally, the Order includes the formal “Made this 26th day of September 1997” statement and identifies the signatory: NGIAM TONG DOW, Permanent Secretary, Ministry of Finance, Singapore. While this is not a substantive tax rule, it provides documentary evidence of proper making and authentication of the instrument.
How Is This Legislation Structured?
This Order is structured in a simple, two-section format typical of many “approved entity” tax orders. It contains:
(1) Section 1: Citation (short title).
(2) Section 2: The substantive approval—naming the approved bank and specifying the effective date and the Income Tax Act provision to which the approval relates.
There are no “Parts” or elaborate schedules in the extract. The instrument is essentially a legal designation notice. Its structure reflects its limited scope: it does not set out eligibility criteria (those are presumed to be in the Income Tax Act or in administrative processes), and it does not create a general regulatory regime. Instead, it applies the statutory approval mechanism to a specific bank.
Who Does This Legislation Apply To?
The Order applies directly to Chang Hwa Commercial Bank Ltd, insofar as the bank seeks to rely on (or is subject to) the tax consequences that flow from being an “approved bank” under section 13(1)(t) of the Income Tax Act. The designation is effective from 16 October 1997, meaning that the bank’s entitlement (or the tax treatment) under the relevant Income Tax Act provision is tied to that date.
Indirectly, the Order is also relevant to tax administrators and tax practitioners advising the bank. For example, when preparing tax computations, responding to queries, or assessing whether a particular deduction/exemption applies, practitioners must confirm that the bank’s “approved bank” status was in force for the relevant period and that the approval is linked to the correct statutory provision.
Because the Order is specific to one bank, it does not generally apply to other banks or financial institutions unless they are separately designated by other “approved banks” orders. In practice, lawyers should consult the legislation timeline and the relevant “approved banks” series to determine whether other banks received similar approvals and on what dates.
Why Is This Legislation Important?
Although the Income Tax (Approved Banks) (No. 7) Order 1997 is brief, it is legally important because it operationalises a statutory tax concept: “approved bank” status under the Income Tax Act. In Singapore’s tax system, such status-based designations can materially affect tax outcomes. For a practitioner, the value of this Order lies in its ability to confirm—by formal legal instrument—that a named bank qualifies for the specific tax treatment referenced in section 13(1)(t).
From an enforcement and audit perspective, the Order provides documentary support for the tax position taken by the bank. If a tax authority questions whether the bank qualifies for a particular treatment, the existence of a valid subsidiary legislation order with a specified effective date can be decisive. Conversely, if the effective date is not satisfied, the bank may not be able to claim the benefit for earlier periods.
Practically, this Order also illustrates how Singapore tax law uses a combination of principal legislation (the Income Tax Act) and subsidiary legislation (orders) to implement targeted eligibility determinations. Lawyers advising financial institutions should therefore treat these orders as part of the “living” compliance landscape: approvals can be granted at different times, and the relevant tax treatment may depend on the precise statutory linkage and commencement date.
Finally, the Order’s reference to section 13(9) underscores that the approval power is statutory and ministerial. This is relevant when advising on governance, internal controls, and the legal basis for tax positions. It also helps practitioners understand that the approval is not merely an administrative label; it is a formal legal designation made under delegated legislative authority.
Related Legislation
- Income Tax Act (Chapter 134) — in particular:
- Section 13(1)(t) (the provision for which “approved bank” status is relevant)
- Section 13(9) (the authorising power for the Minister for Finance to make orders approving banks)
- Income Tax (Approved Banks) Orders (series) — other “(No. X)” orders that may designate different banks or update approvals over time
- Legislation Timeline / Versioning materials — to confirm the correct version and effective date for the relevant order
Source Documents
This article provides an overview of the Income Tax (Approved Banks) (No. 7) Order 1997 for legal research and educational purposes. It does not constitute legal advice. Readers should consult the official text for authoritative provisions.