Type to search

A Quick Summary Of Budget 2018

February 19, 2018

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.

Singaporean Businesses

  • 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

EasyRates is Singapore’s preferred portal for home loans, refinancing, equity loans, overseas loans, personal and business loans, having long standing partnerships with more than 20 banks. Our experienced consultants are advocates for our customers and work hard to ensure you get the best packages available. The best part? Our services are 100% free of charge. Here at EasyRates we pride ourselves on providing unbiased advice on all loans and financial products and putting our customers above all else. So what are you waiting for? Get a FREE Mortgage consultation today!


Leave a comment

Wayne Quek

Wayne is a Chartered Financial Analyst (CFA), and holds a Bachelor of Business Management (Finance) from Singapore Management University (SMU). A successful Relationship Manager during his time with DBS and HSBC, Wayne used his expertise in financial markets to help his clients build up comprehensive investment portfolios. The entrepreneur is also the founder of Home Loan Whiz, a mortgage consulting firm that assists clients with selecting ideal mortgages for their needs.

  • 1

Leave a Comment

Your email address will not be published. Required fields are marked *