ANNOUNCEMENT 23 Feb 2015

In February 2015, the government of Singapore announced .

NUMBER OF INTERVENTIONS

2

  • 0 harmful
  • 2 neutral
  • 0 liberalising

SOURCE



Official information for business on 2015 budget:
http://www.singaporebudget.gov.sg/budget_2015/Business1.aspx


Inception date: 01 Apr 2015 | Removal date: open ended

Labour market access

On 23 February 2015, the Singaporean Deputy Prime Minister presented the annual budget to the parliament. He announced the prolongation of the Wage Credit Scheme and the Corporate Income Tax Rebate (henceforth: CIT rebate) for another two years but under milder conditions. Both programmes were part of the Transition Support Package announced in the 2013 budget (cf. Related Measures).
In the years 2016 and 2017, the government will cover 20% of wage increases of at least 50 SGD with a maximum monthly wage of 4'000 SGD (previously 40%). Meanwhile, the maximum annual CIT rebate per company shall be 20'000 SGD in those two years (earlier 30'000 SGD).
Despite the smaller state aids, the measure would be classified as red, since the Transition Support Scheme was previously supposed to expire anyway. However, as the migration part of the announcement is trade-liberalising, so overall this measure shall be classified as amber.
 
Levy increase for S Pass and Work Permit holders largely frozen
Furthermore, "as the net inflow of foreign workers (excluding construction) has slowed significantly, the Government will defer this year's round of announced levy increases for S Pass and Work Permit Holders, with the exception of Work Permit Holder levies in the Manufacturing and Construction sectors: 

  • Manufacturing Sector. The current Work Permit Holder levy rates for 2015 and 2016 will be frozen at 2014 levels.
  • Construction Sector. (...) (i) Basic tier levy for basic skilled R2 workers will be raised from $550 in July 2015 to $650 in July 2016 and $700 in July 2017; and (ii) Man-year entitlement waiver levy rate for more highly skilled R1 workers will be reduced from $750 to $600 from July 2015."

The government also prolonged and extended numerous SME-supporting schemes, e.g. by increasing the co-investment cap to 2 million SGD for BAS and Spring's Startup Enterprise Development Scheme.
The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets, and from foreign subsidiaries.
 

AFFECTED SECTORS

 
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AFFECTED PRODUCTS

 
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Inception date: 01 Apr 2015 | Removal date: open ended

Tax or social insurance relief

On 23 February 2015, the Singaporean Deputy Prime Minister presented the annual budget to the parliament. He announced the prolongation of the Wage Credit Scheme and the Corporate Income Tax Rebate (henceforth: CIT rebate) for another two years but under milder conditions. Both programmes were part of the Transition Support Package announced in the 2013 budget (cf. Related Measures).
In the years 2016 and 2017, the government will cover 20% of wage increases of at least 50 SGD with a maximum monthly wage of 4'000 SGD (previously 40%). Meanwhile, the maximum annual CIT rebate per company shall be 20'000 SGD in those two years (earlier 30'000 SGD).
Despite the smaller state aids, the measure would be classified as red, since the Transition Support Scheme was previously supposed to expire anyway. However, as the migration part of the announcement is trade-liberalising, so overall this measure shall be classified as amber.
 
Levy increase for S Pass and Work Permit holders largely frozen
Furthermore, "as the net inflow of foreign workers (excluding construction) has slowed significantly, the Government will defer this year's round of announced levy increases for S Pass and Work Permit Holders, with the exception of Work Permit Holder levies in the Manufacturing and Construction sectors: 

  • Manufacturing Sector. The current Work Permit Holder levy rates for 2015 and 2016 will be frozen at 2014 levels.
  • Construction Sector. (...) (i) Basic tier levy for basic skilled R2 workers will be raised from $550 in July 2015 to $650 in July 2016 and $700 in July 2017; and (ii) Man-year entitlement waiver levy rate for more highly skilled R1 workers will be reduced from $750 to $600 from July 2015."

The government also prolonged and extended numerous SME-supporting schemes, e.g. by increasing the co-investment cap to 2 million SGD for BAS and Spring's Startup Enterprise Development Scheme.
The GTA includes state guarantees and other financial incentives that are likely to affect the restructuring and performance of firms facing international competition, whether from imports, in export markets, and from foreign subsidiaries.
 

 
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