Singapore will lower its existing corporate tax rate of 20 percent by at at least one percentage point to stay competitive, former prime minister Lee Kuan Yew said in remarks published on Sunday.

"You know this is a tough and competitive world. People don't come because they like Singapore," Lee, the influential minister mentor in his son Prime Minister Lee Hsien Loong's cabinet, was quoted as saying by the Sunday Times.

"They come because the returns are better," he said.

In reference to Hong Kong, where companies are taxed at just 17.5 percent, one of the lowest in the world, Lee said Singapore had to lower its corporate tax rate or lose out to the former British colony in attracting investors.

"We're going to bring it down... at least by one percentage point," Lee told local media. "Otherwise, we'll lose them to Hong Kong," he said.

The government previously indicated the corporate tax rate would likely be lowered but gave no specifics.

Details will be announced on February 15 when the government presents its annual budget for the fiscal year starting April.

The government is also planning to raise the consumption tax from the existing five percent to seven percent.