Tax Alert – Solidarity Budget

As the COVID-19 pandemic has exploded globally and notwithstanding comprehensive and complementary measures introduced by Singapore, ie safe distancing, early identification and isolation of cases and quarantine of close contacts, the number of infected cases continue to grow. The Singapore Government therefore had no choice but to implement the “circuit breaker” measures last Friday. This will result in closure of most workplaces – except for essential services and key economic sectors, from 7 April 2020 to 4 May 2020. It will disrupt businesses and impact workers severely. Jobs and livelihoods of our people are bound to be badly affected during this period by the heightened measures. This was already pre-empted and on 6 April 2020, the Deputy Prime Minister Heng Swee Keat announced the Solidarity Budget to provide further support for businesses and people to tide over this difficult period. The cost for this additional support will be $5.1 billion. Altogether the Government’s support for COVID 19 will be $59.9 billion or about 12% of GDP.

Details for the Solidarity Budget are as follows:


Enhanced Jobs Support Scheme (JSS)

  • Temporary enhancement on wage offset to 75% for the first $4,600 of monthly salaries paid to each local employee (Singapore Citizens and Permanent Residents) for the month of April only in all sectors
  • First JSS payout will be brought forward  to be paid in April 2020 instead of end May 2020
  • Employers will not benefit from the temporary enhancement to the JSS if they do not pay wages in April 2020
  • The JSS payout is as demonstrated by the table below.

Schedule and Quantum of JSS Payouts after the Temporary Enhancement to the JSS

Payout Date of Payment Food Services Others (excluding aviation, tourism, food services)
Computation of Payout
Capped at first $4,600 of gross monthly wages Based on:
Payout 1 Apr 2020

+ 75% of Oct 2019 wages
+ 50% of Nov 2019 wages
+ 50% of Dec 2019 wages

+ 75% of Oct 2019 wages
+ 25% of Nov 2019 wages
+ 25% of Dec 2019 wages

Payout 2 Jul 2020

+ 50% of Feb 2020 wages
+ 50% of Mar 2020 wages
+ (75% of Apr 2020 wages
- 25% of Oct 2019 wages)

+ 25% of Feb 2020 wages
+ 25% of Mar 2020 wages
+ (75% of Apr 2020 wages
- 50% of Oct 2019 wages)

Payout 3 Oct 2020

+ 50% of May 2020 wages
+ 50% of Jun 2020 wages
+ 50% of Jul 2020 wages

+ 25% of May 2020 wages
+ 25% of Jun 2020 wages
+ 25% of Jul 2020 wages

*If Payout 2 is insufficient to make this adjustment, the outstanding amount will be adjusted through Payout 3

Note : Aviation and tourism sectors will continue to receive 75% wage subsidies on the first $4,600 of gross monthly wages for local workers for all applicable months

  • It should be noted that the JSS is applicable to all workers even if they earn more than $4,600.The JSS benefit is merely capped to a salary limit of $4,600.
  • Firms on Giro and Paynow will start to receive the first JSS payout next week. Those who are not will receive their payout by cheque starting about a week later.

Foreign Worker Levy (FWL)

  • Waiver of monthly FWL due in April 2020
  • FWL rebate of $750 in April 2020 for previous levies paid in 2020 for each Work Permit or S Pass holder

Rental Costs Support

  • 1 month rental waiver for industrial, office and agriculture tenants of Government agencies instead of  0.5 months as previously announced
  • Introduction of laws to allow deferral of certain contractual obligations, e.g rental payment, loan payment
  • Introduction of laws to ensure property owners pass on the property tax rebate in full to tenants

Credit Support

  • Risk-share for Temporary Bridging loan, Enterprise Financing Scheme – SME Working Capital Loan, and Enterprise Financing Scheme -Trade Loan by Government will be increased from 80% to 90% for loans initiated from 8 April 2020 until 31 March 2021
  • Option available to SMEs to defer principal payments on secured term loans till end of the year
  • Banks and finance companies may apply for low-cost funding through a new MAS Singapore Dollar facility, for new loans granted under the Enterprise Financing Scheme, SME Working Capital Loan and Temporary Bridging Loan Programme but must commit to pass savings to their borrows


Self-Employed Person Income Relief Scheme (SIRS)

  • Enhanced to :
    • Automatic inclusion of SEPs who earn a small income from employment work
    • Increase Annual Value of property threshold to $21,000 from $13,000


Solidarity Payment

  • One-off cash Solidarity payment of $600 (inclusive of $300 from the earlier enhanced Care and Support scheme) in April 2020 to Singaporeans aged 21 and above
  • For those who have provided bank account details, the Solidarity payment will be credited directly into their bank accounts by 14 April 2020. The rest will receive cheque payment starting from 30 April 2020
  • Other cash payouts announced in the Resilience Budget is brought forward and paid in June 2020 instead of August 2020

Finally, please note that although our office will be closed from 7 April 2020 to 4 May 2020, in accordance with the Government’s requirement, all our members will continue to be working from home. You can therefore continue to contact us for any assistance required. 


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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]