In a bid to boost growth and productivity amid global economic and geopolitical uncertainties, Singapore Finance Minister Heng Swee Keat announced measures to support infrastructure projects and industries like marine and processes.
The 2017 budget comes less than two weeks after a government-
appointed panel, led by Heng, outlined initiatives to propel the economy into its next phase of growth. The range of measures aim to help spur growth to 2 percent to 3 percent a year over the next decade. Here are some of the biggest winners and losers of the Singapore budget.
WINNERS
Jobs – Skills training support will be provided to aid in improving workforce productivity. More than SGD600 million will be paid out to help companies cope with rising wages. The Ministry of Manpower will extend employment age to 67 from 65. Enhanced corporate tax rebate cap would be raised to SGD25,000 at 50 percent of tax payable. The tax rebate would be extended by another year, capped at SGD10,000, 20 percent of tax payable. National Research Fund will be topped up by SGD500 million and National Productivity Fund will be increased by SGD1 billion. Small & Medium Enterprises (SMEs) – Programs to support digitalization and innovation will be rolled out to aid SMEs.
Public Infrastructure Investment – The government will bring forward SGD700 million in infrastructure projects to support the construction sector. A total of SGD150 million will be spent to procure innovative construction solutions for public sector projects.
Marine & Processes – Foreign worker levy increases will be deferred for one more year to aid employers in these sectors. Sembcorp Industries Ltd. gained as much as 1.6 percent after the measures were announced. Sembcorp’s businesses include utilities as well as water and land development.
Healthcare – Including existing initiatives, the government will spend SGD400 million per year to provide support to persons with disabilities and their caregivers in areas of early intervention and education, employment, care services, “assistive” technologies and improving healthcare accessibility. Additional SGD160 million to be spent on supporting those with mental health conditions over the next five years.
Cyber security – Government will spend more than SGD80 million on programs to strengthen capabilities in data and cyber-security.
Singapore-based firms – SGD600 million in government capital will be allocated for a new International Partnership Fund to help Singapore-based firms in scaling up and internationalization.
LOSERS
Power Stations, Utilities – Government plans to implement a carbon tax between SGD10-SGD20/ton of greenhouse gas emission from 2019 on power stations, large direct emitters instead of electricity consumers.
Consumers – Water prices will increase by 30 percent in two phases, starting July 1. Prices haven’t been raised in 20 years and costs need to be reflected. Bloomberg
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