Singapore budget focuses on jobs and strengthening businesses

Singapore’s Deputy Prime Minister Heng Swee Keat delivered the 2021 Budget on February 16, 2021, promising to build a stronger Singapore following the COVID-19 pandemic

The budget aims to create good jobs, and opportunities for businesses, as well as working towards becoming a greener and more sustainable country, and building the social compact and community spirit.

For businesses, the DPM extended the Jobs Support Scheme (JSS) by either three or six months for certain sectors that continue to be affected by the coronavirus pandemic. Costing S$700 million, the extension covers the aviation, aerospace and tourism sectors at Tier One, and the retail, arts and culture, food services and built environment sectors at Tier Two. All other sectors will continue to receive wage support up to March 2021.

The JSS extension forms part of a new S$11 billion Covid-19 Resilience Package, of which S$4.8 billion is set to be channelled towards public health and safe re-opening measures. The package also aims to support workers and businesses where necessary, and support for sectors which remain under stress.

$24 billion will also be spent over the next three years to help firms and workers adapt to the ‘new normal’ partly caused by the pandemic. This includes working to restore the country’s physical connectivity with the rest of world, expanding its digital connectivity and deepening its capacity to collaborate and innovate with global partners.

Singapore will invest in three platforms designed to spur collaboration and innovation on a global scale. The Corporate Venture Launchpad will provide co-funding for companies to build new ventures. The Open Innovation Platform will be enhanced to increase the speed and scale of digital innovation, and enhancements will be made to the Global Innovation Alliance which helps to catalyse cross-border collaboration.

The DPM also announced that a Goods and Services Tax (GST) hike would not happen this year, but would be raised from 7% to 9% at some point between 2022 and 2025. However, low-value goods worth S$400 or less bought online and imported by air or post will be subject to GST from Jan 1, 2023.

Additional measures include more charging points for electric vehicles and measures to reduce their cost, a lower S Pass quota for the manufacturing sector from 2023, higher petrol duty, $100 vouchers for Singaporean households, new bonds totalling up to $90 billion to finance long-term infrastructure and $870 million support for the aviation sector.

For more information, contact Alpadis Group