A slide from the Budget 2016 presentation by Finance Minister Heng Swee Keat
Parents and parents-to-be, small and medium enterprises and the elderly were among the biggest winners in this year’s Budget, even as Finance Minister Heng Swee Keat warned of strong economic headwinds. His maiden Budget drew generally positive reactions from these groups, while other Singaporeans questioned if more could have been done for the vulnerable groups.
Small and Medium Enterprises
Among other initiatives, the corporate income tax rebate will be raised from 30 to 50 per cent of tax payable, with a cap of $20,000 rebate each year. The Special Employment Credit (SEC) is also being modified and extended to the end of 2019. This will provide employers with a wage offset for workers aged 55 and above who earn up to $4,000 a month.
Edward Chia, 27, owner of Korean take-out business Dosirak, cheered the Budget goodies to help enterprises like his. He said that the tax rebate would enable him to consider giving slightly higher bonuses to retain Singaporean employees, who are especially hard to come by in the F&B industry.
“It is good that Singapore recognises the fact that an increased rebate not only helps us to reinvest in our business, but also increases our cash flow temporarily, as SMEs require a lot of cash flow flexibility to grow or flourish.”
Chia, who employs three elderly workers, added that the extension of the SEC would encourage him to hire more of them. The current scheme has already enabled him to offer them “attractive packages” and send them for upgrading courses.
Parents of babies born from Thursday (24 March) will get a $3,000 injection into their offspring’s Child Development Account (CDA), under the new First Step Grant.
Systems operator Noorhakim Abdul Raman, 28, whose wife is due to give birth in May, welcomed the news. “I don’t need to top up my daughter’s account now that the government will be giving $3,000. I will definitely use it for my baby’s monthly health check-ups and future childcare fees. If I could use it for enrichment classes, I would too.”
He added, “It’ll be great if childcare leave can be extended to up to 10 days for those working in private companies. For now, I get only 6 days a year until my daughter turns seven.”
More than 140,000 senior citizens aged 65 and above, most of them from the bottom 20 per cent of this demographic group, will benefit from the Silver Support Scheme. They will get between $300 and $750 every quarter, depending on their household type.
Senior citizens already on the monthly ComCare Long Term Assistance Scheme will also get a Silver Support payout of $300 every quarter.
Self-employed Nurul Shahidah, 29, is the primary caregiver for her 89-year-old grandmother. Nurul’s grandmother currently receives financial assistance through the Pioneer Generation medical benefits and welfare assistance schemes.
As the pair live in a 3-room HDB flat, she also qualifies for the $600 quarterly payout. Nurul said that her grandmother is “independent” despite being wheelchair-bound and incontinent. “She doesn’t really ask openly for money. Even when it comes to buying her own diapers, she would want to buy it herself, so the money will definitely help her out. It will alleviate the financial stress on her and the people around her too,” Nurul added.
What about other Singaporeans?
SEO Executive Purnima Balraju, 24, noted that little had been done for Singaporeans who are single or have just started working. Her parents are in their sixties. “I have to look after my mum and dad, especially so after my dad retires. Nothing in the budget seems to help lessen the strain.“
Accountant Jonathan Lim, 29, noted the dual aims in the Budget to push businesses to innovate and automate, while encouraging low-skilled workers to improve and learn new skills to take on more skilled jobs.
“This all makes sense on paper, since the innovation and automation will make jobs by low-skilled workers redundant, and the government hopes that the introduced Skillsfuture and TechSkills Accelerator will provide these displaced workers with better opportunities. But whether it succeeds in reality remains to be seen”