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Creative Will Absorb the 2% Increase in GST for its Products Sold in Singapore

No Increase in the Suggested Retail Prices of its Current Products with the GST Hike

SINGAPORE - June 26, 2007 - Creative Technology Ltd. (NASDAQ: CREAF), a worldwide leader in digital entertainment products, today announced that Creative will not increase the current suggested retail prices of its personal digital entertainment products sold in Singapore with the impending increase in Goods and Service Tax (GST) that will take effect from 1 July 2007. This initiative will help provide an additional cushion to lessen the impact of the GST increase to consumers as Creative will absorb the 2% GST increase. As announced in the Singapore Budget 2007 on 15 February 2007, the GST in Singapore will be increased from 5% to 7% with effect from 1 July 2007.

Creative's wide range of personal digital entertainment products is available in Singapore at The CREATIVE Stores at Marina Square, Plaza Singapura and International Business Park, the online store at sg.store.creative.com, as well as through authorised dealers island-wide. With this initiative, from 1 July 2007, there will be no increase in the current suggested retail prices of Creative's products such as portable media players, MP3 players, multimedia speakers, sound cards, webcams and headphones, as a direct result of the impending GST increase. The absorption of the 2% GST increase by Creative will be translated into savings to its customers when the GST hike takes effect.

“We are happy to play our part for the community and help lessen the impact that the GST increase would bring to consumers. Our customers in Singapore can look forward to being able to enjoy Creative's personal digital entertainment products at the same affordable prices. This initiative will help our customers to eventually adjust to the increased GST.” said Joseph Liow, Vice President of Creative Technology Ltd and General Manager of Creative Labs Asia.

About Creative
Creative (NASDAQ: CREAF) is a worldwide leader in digital entertainment products. Famous for its Sound Blaster sound cards and for launching the multimedia revolution, Creative is now driving digital entertainment on the PC platform with products like its highly acclaimed ZEN™ portable audio and media players. Creative's innovative hardware, proprietary technology, applications and services leverage the Internet, enabling consumers to experience high-quality digital entertainment -- anytime, anywhere.

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This announcement relates to products launched in Asia Pacific. The product names, content, prices and availability are subject to change and may differ elsewhere in the world according to local factors and requirements. Creative and the Creative logo are registered trademarks of Creative Technology Ltd. in the U.S. and other countries. All other brand and product names are trademarks or registered trademarks of their respective holders.