Singapore FY2020 Budget Statement Summary
Did you know that Singapore focuses its FY2020 Budget to help families in the country?
The Singapore Government plan to uplift the economy affected by the continuous COVID-19 outbreak.
These are the summary and key highlights you should know and understand.
1. $800 Million to Support the Coronavirus Outbreak
Singapore has set aside a sum of S$800 million dollars to help the economy recover from the lethal virus outbreak, even though the duration, as well as the severity of the virus.
A huge portion of this money will go straight to the Ministry of Health, which is on top of what has already committed to public health each year.
The economy of the country increased by 0.7 per cent last year. Now, this is the weakest development after the 2008 financial crisis.
Aviation and tourism are most affected by COVID, including hotel occupancy and visitor arrivals.
Not to mention that it also affected the supply chain sector, building a ripple effect on other industries. Ministry of Trade and Industry (MTI) downgraded GDP from 0.5-2.5 per cent to -0.5-1.5 per cent.
2. Backing Up Lifelong Learning with SkillsFuture Enhancements
Budget 2020 aims to support Singapore citizens to get new skills in the middle of the structural transformations in the worldwide economy.
Singapore can achieve this with the help of the Next Bound SkillsFuture and including below core elements:
- Special focus on mid-career workers
- Improving the role of enterprises in developing their existing staff
- Permitting the individual
SkillsFuture Mid-Career Support Package (For Mid-Career Workers)
This concentrates on mid-career workers who are in their 40’s and 50’s and to help them stay employed and move on to new roles and new jobs.
The role is to double the annual job placements of individuals who are in this age bracket and encourage continuous learning.
SkillsFuture Credit at S$10,000 Every Enterprise (For Enterprises)
The goal is to support employers to get on on the upskilling of the labour force and SMEs stand to gain most in this scheme.
Also, the government will expand the coverage of the Productivity Solutions Grant (PSG) to support more digitalisation initiatives.
SkillsFuture Credit up to S$500 (For Individuals)
Every Singaporeans, aged 25 and above, will receive a SkillsFuture Credit top-up of S$500 and this will be accessible from October 2020, and expire by the end of 2025.
This enhancement strives to motivate people to take action earlier to learn new skills and maximize the time of economic slowdown.
3. S$8.3 Billion to Allow Growth Efforts and Transformation
Singapore has also set aside a sum of S$8.3 billion for more than three years. This fund helps Singapore businesses to enable its growth and transformation efforts.
This includes three areas; building our people, deepening the capabilities of businesses and building stronger partnerships
You will find two different packages as part of this growth and transformation efforts to help enterprises.
Package 1: Enterprise Transform Package
The goal is to present the Enterprise Leadership for Transformation Programme which aim to back up SME business leaders
This package also helps them to accomplish the next bound of expansion and growth.
Package 2: Enterprise Grow Package
This package aims to achieve the following:
- Help more businesses enter the new markets and improve market readiness grant
- Better adoption of digital technology
- Grow business platforms
4. GST to Stay at 7% for 2021
Singapore will not adopt the two per cent rise in GST in 2021, considering the existing condition of the economy.
The good thing is that the rise of GST rate may happen in 2025 and the Government will evaluate the necessary time to publicize it.
There is S$6 billion Assurance Package for all Singaporeans when there is an increase in GST rate to mitigate the repercussion suffered.
For those low-income households, you need not worry because you will get offsets equivalent of ten years’ worth of added GST expenses suffered.
On the other hand, those people who are currently living in one to three-room HDB flat will get offsets that are equivalent to the ten years’ worth of added GST expenses suffered.
5. Assistance and Stabilization Package of 4 Billion Dollars
This package supports the workers to remain employed in this period of slow economic growth.
You see, a new cash grant will offer eight per cent of the wages of local workers for three months.
This will help them keep employed in the middle of the COVID-19 outbreak.
That will cost the government at least S$1.3 billion and benefit every business as well as their staff. This will be in place by the end of July 2020.
You will also get a corporate income tax rebate for the year of assessment at twenty-five per cent, capped at S$15,000 every company.
The goal of this package is to help businesses with cash flow. Singapore will also improve the wage credit scheme to help wage raises for the workers of the nation.
6. CPF and Raised Retirement Assistance For Seniors
Matched Retirement Savings Scheme
The government will launch the Matched Retirement Savings Scheme and this will help people with less CPF savings to save more.
This is ideal for seniors between age 55 to 70 and whom they do not meet the Basic Retirement Sum requirements.
Enhancing Silver Support & Lease Buyback Scheme
The scheme increases the quarterly cash payments by twenty per cent. Singapore will launch a new payout tier to offer a smaller payout to seniors whose monthly income falls amid S$1,300 and S$1,800.
Senior Workers Support Package
This package aims to help seniors to stay active and contribute to the economy and society by supporting lifelong employability.
This package includes the following:
- Part-Time Re-employment Grant
- Senior Worker Early Adopter Grant
- CPF Transition Offset
- Senior Employment Credit
Overall, the Singapore Budget 2020 will see a total budget deficit of 10.9 billion dollars, which is 2.1 per cent of the GDP.