This year’s Budget shines much of the spotlight on the Singapore economy and businesses, with measures to foster medium-term economic transformation, and to ease short-term pressures.
Titled ‘Partnering for the Future’, Budget 2016 presents a prudent yet targeted response aimed at paving the way to SG100. With the focus on fostering the spirit of partnership, Budget 2016 sets out to transform the economy, encourage innovation, and nurture an inclusive and resilient society. Businesses, households, workers and the wider community all stand to gain from the Budget this year.
Businesses have good reasons to cheer about Budget 2016. The new Industry Transformation Programme is one of such initiatives that will help businesses create growth and value through capability development and technology adoption. This will enable businesses to scale up their operations and productivity which will help pave the way for overseas expansion and internationalisation. This echoes the findings from the ISCA Pre-Budget Survey earlier this year, which found that businesses would like to have greater support in facilitating market access and knowledge, and financial support to expand overseas.
At the ISCA Pre-Budget Roundtable held in January, our panel of experts also highlighted the need for ease of grant application for government schemes. The upcoming launch of a one-stop business grants portal under Budget 2016 is welcoming news as the portal provides a single place for SMEs to access government grants across different agencies.
Budget 2016 also ensures that businesses seeking to expand overseas can enjoy the double tax deduction for internationalisation scheme. The scheme which offers 200 per cent tax deduction on eligible expenses has been extended to 2020. Likewise, businesses can look forward to more support when they engage in M&As, with the government doubling the existing cap for qualifying M&A deals made from April 1 onwards.
SMEs, in particular, will enjoy much support from Budget 2016. For example, they can now apply for loans under the newly introduced SME Working Capital Loan scheme. This provides much-needed access to financing for SMEs to ease cash flow concerns or grow their businesses. Smaller SMEs can also expect greater support from the SME mezzanine growth fund which is now expanded to up to S$150 million, compared to the current S$100 million. These timely measures help ensure that Singapore businesses, including those in the accounting and finance sector, are well-positioned to take advantage of the Asean Economic Community.
Also key to Singapore’s future is human development. SkillsFuture will be expanded to aid mid-career job seekers, and other workers to upgrade their skills and find jobs. Wage support to help retrenched workers will be enhanced through the Adapt and Grow initiative. Families will also receive more support for their children’s childcare and healthcare needs.
Since Budget 2016 was announced, both businesses and individuals have described the Budget as being prudent and inclusive, well-balanced and transformative.There are also others who shared views on issues like cost competitiveness and availability of manpower across different sectors. With the diverse views we have read and heard so far, I believe today’s panel discussion will be very engaging and enriching.
We are honoured to have with us today, Prof Sum Yee Loong, Professor of Accounting at the Singapore Management University, to share more details on the 2016 Budget Update and its Tax implications. We also pleased to have Mr Francis Tan, Economist for Global Economics & Markets Research from United Overseas Bank here today to share more on the Economic Outlook and Analysis of Budget 2016.
I look forward to, and wish you, an enjoyable session ahead. Thank you.