On the 6th of April, Singapore’s Deputy Prime Minister and Finance Minister Mr Heng Swee Keat announced the unprecedented second supplementary and third overall budget announcement to help Singapore businesses and Singaporeans.
This is in response to the mandatory shutdown of all non-essential businesses in the month of April.
Let’s take a look at the three pillars of support for Singapore businesses, its breakdown and how each pillar has been enhanced progressively to provide maximum support for SMEs.
(Update)
On the 21st of April, Singapore’s Prime Minister Mr Lee Hsien Loong announced a 4-week extension to the circuit breaker measures. The mandatory shutdown of all non-essential businesses will extend to 1st June 2020.
Thus, the government will enhance the Jobs Support Scheme (JSS) announced in the Solidarity Budget. The 75% wage subsidy for each local employee will be extended to the month of May and cover shareholders-directors of companies for the entire period of JSS.
Foreign worker levy (FWL) waivers and rebates will also be extended by one month.
Cost Support
| Budget 2020 |
Unity |
Resilience |
Solidarity |
| Jobs Support Scheme |
- 8% cash grant each SG employee
- For the first $3,600
- 3 months
|
- Increased to 25% cash grant for each SG employee
- Increased to first S$4,600 wages
- Increased to 9 months
- Enhanced support of 50% & 75% cash grant for Food Services, Aviation & Tourism Sector respectively
|
- Increased to 75% cash grant for each SG employee
- Increased to first S$4,600 wages
- Only for April 2020
- Will revert to resilience package in May
- (Update) Extended for May 2020
- (Update) Will now cover shareholder-directors with NOA less than $100,000 for the entire period of JSS
|
| Point-to-point Support Package |
- Eligible drivers will receive $300 per month from government
- Taxi operators will match the government rebates
- 3 months (until May)
|
- Eligible drivers will receive $300 per month from government
- Taxi operators will match the government rebates
- Increased to 7 months (until September)
- Eligible drivers to get $1,000 a month for 9 months under the Self-Employed Person (SEP) Income Relief Scheme
|
- Subsidies remains the same
- More drivers to get $1,000 a month for 9 months under the Self-Employed Person (SEP) Income Relief Scheme due to changes to eligibility criteria
|
Cash Support
| Budget 2020 |
Unity |
Resilience |
Solidarity |
| Property Tax Rebate for Non-Residential |
- 30% property tax rebate for Tourism-related industries
- 15% rebate for cruise and ferry terminals
- 10% for Integrated Resorts
|
- 100% property tax rebate for Tourism-related industries, cruise and ferry terminals
- 60% rebate for integrated resorts
- 30% rebate for all other non-residential properties
|
- No changes to property tax rebate from Resilience Budget
- Legislation will be introduced to ensure landlords pass down property tax savings to tenants
|
| Rental Waivers |
- 1 month waiver for Hawkers & Market
- 0.5 month waiver for commercial tenants in Gov-managed properties
|
- 3 month waiver for Hawkers & Market
- 2 month waiver for eligible commercial tenants in Gov-managed properties
- 0.5 month waiver for other non-residential tenants in Gov-managed properties
|
- 3 month waiver for Hawkers & Market
- 2 month waiver for eligible commercial tenants in Gov-managed properties
- 1 month (up from 0.5 month) waiver for other non-residential tenants in Gov-managed properties
|
| Foreign Worker Levy (FWL) |
- No increase of FWL rates for all sectors for 2020
|
- No increase of FWL levy rates for all sectors for 2020
|
- No increase of FWL levy rates for all sectors for 2020
- Waiver of FWL for April 2020
- FWL rebate of $750 for each Work Permit or S Pass Holders
- (Update) Extended for May 2020
|
Credit Support
| Budget 2020 |
Unity |
Resilience |
Solidarity |
| Enterprise Financing Scheme – Working Capital Loan (EFS – WCL) |
- Upgrade of existing scheme
- Increase of max loan quantum from $300,000 to $600,000
- Government risk share increased from 50 – 70% to 80%
- Valid for 1 year from March 2020
|
- Increase of max loan quantum to $1,000,000
- Government risk share at 80%
- Valid for 1 year from April 2020
|
- Max loan quantum of S$1,000,000
- Increase of government risk share to 90%
|
| Enterprise Financing Scheme - Trade Loan (EFS - TL) |
- No changes to existing Enterprise Singapore scheme
- Max loan quantum of S$5 million
- Government risk share 50 – 70%
|
- Max loan quantum increased to $10 million
- Government risk share increase to 80%
- Valid for 1 year from April 2020
|
- Max loan quantum of $10 million
- Government risk share increased to 90%
- Valid for new applications initiated from 8 April until 31 March 2021
|
| Temporary Bridging Loan Programme (TBLP) |
- Newly introduced
- Applicable for Tourism Sector only
- Max loan quantum of $1 million
- Interest rates capped at 5% p.a.
- Government risk share at 80%
- Valid for 1 year from March 2020
|
- Applicable to All Sectors
- Increase of max loan quantum to $5 million
- Interest rates capped at 5% p.a.
- Government risk share at 80%
- Valid for 1 year from April 2020
|
- Applicable to All Sectors
- Increase of max loan quantum to $5 million
- Interest rates capped at 5% p.a.
- Government risk share increased to 90%
|
Source: Unity Budget, Resilience Budget, Solidarity Budget
Source: Unity Budget, Resilience Budget, Solidarity Budget
The total amount of this year’s budget will reach S$59.1 billion. Here’s hoping that the economy recovers as soon as possible.
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About the author
Eric Koh is passionate about helping SMEs grow and has spent years interacting with business owners at OCBC and IFS Capital. He is interested in 70s rock ‘n roll, the odd novel and copious amounts of historical trivia.
