Deputy Prime Minister and Finance Minister Heng Swee Keat has introduced a multitude of measures to address the economic development and short-terms challenges such as the Coronavirus outbreak in Budget 2020 on 18 February 2020.
Despite the expected overall deficit of $10.9 billion (2.1% of GDP) – the highest projected deficit in a decade – for FY2020, the Government has set aside $106 billion aimed at helping local households, workers and businesses weather the challenges in these uncertain and turbulent times.
Here are some key highlights of the Budget 2020 announcement:
Due to the current state of economy, the GST increase from 7% to 9% has been pushed back. The 2% hike which was supposed to take place sometime between 2021 to 2025 will not be implemented in 2021. A $6 billion package will be introduced to soften the after-effects of the GST hike that will eventually happen by 2025, if not earlier.
The 5 sectors directly impacted by COVID-19 will receive additional support for their operating costs and cash flow. These sectors include tourism, aviation, retail, food services, and point-to-point transport services.
Food Services Sector
Point-to-Point Transport Services Sector
Under the Stabilisation and Support Package, businesses will receive help with their cash flow during this difficult economic period in the form of:
Corporate Income Tax Rebate for YA2020
Enhanced Enterprise Financing Scheme – SME Working Capital Loan
Businesses will receive support to help their local workers stay employed through 2 schemes:
Jobs Support Scheme
Wage Credit Scheme
A total of $8.3 billion will be allocated to help companies – from start-ups to SMEs – transform and grow over the next three years. Support will be given to companies at every stage of their growth to deepen industry-wide capabilities. An additional $300 million is dedicated to catalyse investment in local deep-tech start-ups in key emerging sectors for instance advanced manufacturing and agri-food technology.
Help will also be provided for small and medium-sized businesses to go digital, establish business presence overseas and develop & strengthen leadership capabilities through various schemes and grants such as SMEs Go Digital Programme, Enterprise Development Grant (EDG), Market Readiness Assistance (MRA) and Enterprise Leadership for Transformation Programme.
To find out more, please visit Singapore Budget official website.
Source: Singapore Budget GOV & MOF Singapore