Dubbed the ‘Solidarity Budget’, all firms to receive higher wage subsidies among other benefits in attempt to keep companies afloat during April’s shut down
Following the announcement on April 3, 2020 by Prime Minister Lee Hsien Loong that all except essential firms are to close their offices, Deputy Prime Minister and Finance Minister Heng Swee Keat announced his third budget of the year in parliament on April 6.
For firms, the headline announcement was an increase in Jobs Support Scheme (JSS) for every firm totalling 75% of gross monthly wages, for the first S$4,600 of wages paid in April 2020 for each local employee (Singapore Citizen and Singapore Permanent Resident). The first pay-out will be brought forward to April from May 2020 and shall be applicable to all firms regardless of industry.
The budget costs S$5.1 billion and included the waiving of foreign worker levies for April, enhanced eligibility for self-employed income relief as well as a S$600 cash pay-out for all adult Singaporeans.
Approx. 100,000 self-employed persons will benefit from the Self-Employed Person Income Relief Scheme thanks to changes in eligibility, up from 88,000 previously.
The government will also take on 90% of the risk share of loans, up from 80%. These are for loans taken out from April 8, 2020 – March 31, 2021 under the Temporary Bridging Loan Programme, the Enterprise Financing Scheme – SME Working Capital Loan, and the Enterprise Financing Scheme – Trade Loan.
In total, all three budgets should cost S$59.9 billion, around 12% of the country’s GDP, with the budget deficit for FY 2020 rising to S$44.3 billion, 8.9% of GDP.
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