Singapore

Tax Alert – Ministerial Statement dated 17 August 2020

The Deputy Prime Minister and Minister for Finance, Mr Heng Swee Keat, gave a Ministerial Statement on 17 August 2020 announcing an extension of the existing measures to continue the support for businesses and workers. This is a timely announcement as the Singapore economy has been badly affected and some of the measures announced earlier this year are coming to an end. 

The three strategies highlighted by the Minister to deal with the ongoing crisis and enable Singapore economy to rebuild from the crisis are (a) continued support for workers and create new jobs; (b) provide further support for sectors which are hit the hardest; and (c) transform our economy to position for growth in the post-COVID-19 world.

 

CONTINUED SUPPORT FOR WORKERS AND CREATE NEW JOBS


Job Support Scheme ("JSS")

  • JSS which co-funds the first S$4,600 of gross monthly wages of local employees for businesses up to August 2020 will be extended for another seven months up to March 2021, with support level tapered based on the projected recovery of the various sectors.
  • The tiered support levels for the extended seven months are summarised in the table below.
      Tier 1 Tier 2 Tier 3
    Support level for wages paid from September 2020 to March 2021

    50%*

    30%

    10%#

    Applicable sectors

    Aviation, Aerospace and Tourism

    Arts and Entertainment, Food Services, Land Transport, Marine & Offshore and Retail

    All other sectors

    * Built Environment

    The support for September and October 2020 is at 50%. Thereafter at 30% for remaining five months to March 2021

     

    # Financial Services, Information and Communications Technology and Media, Biomedical Sciences, Precision Engineering, Electronics and Online Retail and Supermarkets will be given support up to December 2020 only

Jobs Growth Incentive ("JGI")

  • JGI is introduced to support growing sectors in creating new jobs for local workers, in particular the mature workers.
  • For all new local hires, the Government will co-pay up to 25 per cent of their salaries for one year, subject to a cap. For those aged 40 and above, the co-payment will be up to 50 per cent.
  • More details will be provided by the Ministry of Manpower towards the end of August 2020.

COVID-19 Support Grant ("CSG")

  • CSG, introduced in May 2020 to provide support to Singaporeans who are unemployed or have suffered significant income loss as a result of the COVID-19 outbreak, will be extended until December 2020.
  • From 1 October 2020, applications will be open to both existing CSG recipients and new applicants.
  • Unemployed applicants must demonstrate job search or training effort.
  • More details will be provided by the Ministry of Social and Family Development in early September 2020.

Workfare Special Payment ("WSP")

  • Previously only applicable to Singaporean employees or self-employed persons who had received Workfare Income Supplement (“WIS”) payment for work done in 2019.
  • Eligibility is now extended to lower-wage workers aged 35 and above in 2020 who received the WIS payment for work year 2020 and have not qualified for WSP previously.

SGUnited Jobs and Skills Centres and updating of Tripartite Advisory

  • Setting up of 24 SGUnited Jobs and Skills Centres in heartlands to help jobseekers find a suitable job, traineeship, attachment or training to better prepare them for the recovery.
  • Updating of Tripartite Advisory on Managing Excess Manpower and Responsible Retrenchment to incorporate the Fair Retrenchment Framework proposed by the NTUC.

 

PROVIDE FURTHER SUPPORT FOR SECTORS WHICH ARE HARDEST HIT


Enhanced Aviation Support Package

  • Enhanced Aviation Support Package introduced in the Resilience Budget to provide cost relief for airlines, ground handlers, cargo agents and airport tenants will be extended up to March 2021.

Redeployment of workers

  • The Government has been helping workers in the aviation sector who cannot work now to be redeployed to other areas of need.
  • The Temporary Redeployment Programme has been scaled up, creating about 4,000 new jobs in the healthcare sector.

Supporting tourism sector

  • S$320 million will be set aside for tourism credits that Singaporeans can use to support local tourism.
  • More details will be provided by the Ministry of Trade and Industry (“MTI”) in September 2020.

 

TRANSFORM OUR ECONOMY TO POSITION FOR GROWTH IN THE POST-COVID-19 WORLD


Startup SG Founder Programme

  • To continue to encourage innovation and entrepreneurship, the Government will set aside S$150 million to enhance the Startup SG Founder Programme in phases.
  • More details will be provided by the MTI in September 2020.

 

For further information or assistance, please contact:

Koh Puay Hoon, Partner
T +65 6594 7820
[email protected]

Cindy Lim, Partner
T +65 6594 7852
[email protected]

William Chua, Partner
T +65 6594 7860
[email protected]SMSingapore.sg

Joanna Yap, Partner
T +65 6594 7859
[email protected]

Hsu Chong Hoe, Director
T +65 6594 7861
[email protected]

Yong Jiahao, Director
T +65 6594 7373
[email protected]

Ivy Chiong, Director
T +65 6594 7856
[email protected]