The government extended the festive mood this Chinese new year, when Finance Minister Mr Heng Swee Keat announced an SG Bonus of between $100 – $300 for every Singaporean. Read on to find out what else was included in this year’s blockbuster budget!
SG Bonus For All Adult Singaporeans
- All adult Singaporeans will receive between $100 to $300 depending on their annual income.
Tax Increases (GST, Carbon Tax, Increased Buyer Stamp Duty, Tobacco)
- The GST will be raised from its current 7% to 9% sometime between 2021 and 2025. This will be done progressively.
- Buyer Stamp Duty rates for residential properties will increase from 3% to 4% for property value in excess of $1 Mil.
- A 10% increase in tobacco excise duty will come into effect today. This will affect all tobacco products.
- A new carbon tax will be implemented from 2019 on all businesses that produce more than 25,000 tons or more of greenhouse gas emissions/ year
- The initial carbon tax will be $5/ ton of greenhouse gas emissions from 2019 – 2023
- The carbon tax rate will be reviewed by 2023 and is expected to rise to $10-15/ ton by 2030
- For households, the impact of carbon tax will be small at about 1% of total gas and electricity expenditure on average.
- Additional USave rebates of $20/Year will be given for 3 years to eligible households
- Carbon tax revenues are expected to amount to $1 billion in the first 5 years
More Subsidies To Help You Live Near Your Parents
- The Proximity Housing Grant (PHG) for families buying resale flats to live with their parents or children will be raised to $30,000
- Those buying a resale flat near their parents or children will continue to receive up to a $20,000 subsidy
- The PHG was also enhanced for singles, with those buying a resale flat to live with their parents receiving up to $15,000 and those who buy a resale flat near their parents receiving $10,000
Helping Singaporeans Earn More
- Wage Credit Scheme (WCS) (That helps co-fund wage increases for Singaporeans up to $4,000) extended for 3 years with 20% co-fuding by government in 2018, 15% in 2019 and 10% in 2020
- The Work Trial Scheme will be upgraded to a Career Trial Scheme with higher funding support
Providing More Educational Support
- Edusave annual contributions by the government will rise from $200 to $230 annually for Primary school students and $200 to $290 for Secondary school students from Jan 2019
- Eligibility criteria for Edusave merit bursaries and Independent School Bursaries will be updated to benefit more students
- Support for students from lower income families will increase with a higher burasary quantum of $900 from $750 previously
Getting Singaporeans To Spend Wisely
- A new financial education curriculum will be introduced at ITEs and Polytechnics.
- More services will be provided to Singaporeans at HDB when buying flat and for those who are approaching retirement at CPF board to help make better, more informed decisions
- To support Singaporeans to prepare for healthcare needs in their old age. Eldershield is being reviewed and will be enhanced.
- Corporate Income Tax Rebate raised to 40% YA 2018 capped at $15,000 and extended to YA 2019 at 20% tax payable capped at $10,000
- Startup tax exemptions to be changed from YA 2020 with tax exemption reduced to first 200,000 from first $300,000 previously Startups exempt 70% not 100% of first 100k taxable income
- Funds to be set aside to support companies to improve energy efficiency and reduce emissions via energy efficiency fund and productivity grant for energy efficiency
- To support internationalization, the government will enhance double tax deduction for internationalization (DTDI) changing its cap from $100,000 currently to $150,000/year from YA 2019
- More support will be provided to firms to innovate on more solutions along the value chain and to buy and use new solutions to streamline operations
- A 200% Tax deduction on licensing fees will be implemented
- A 200% tax deduction for intellectual property registration fees capped at $100,000 will be implemented
- Tax deductions for R&D within Singapore will increase from 150% to 250%
- An open innovation platform will be piloted for crowdsourcing business problems. The platform will allow businesses to list challenges to be addressed by digital solutions.
- An initiative to improve labour productivity through robotics especially in the areas of construction and built environment will be announced
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