Singapore budget 2018-Key Highlights and Announcement

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Singapore Budget 2018
Some Goodies for Everyone (PPT)
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It offers Some Goodies for Everyone.

• Finance Minister Heng Swee Keat presented
  Singapore Budget 2018 to the Parliament on
  February 19.

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Mr. Heng said,
It is a wide-ranging Budget to competently
address Singapore's long-term challenges. It is
more of a multi-year agenda for the country.
He announced taxing of property, consumption,
online services.
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It is time act prudently as the Singaporean
economy is maturing but the population is aging.
He reminded Singaporeans to plan for healthcare
expenses.
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The key priority for Singapore is to provide
healthcare for the aging population. The
expenses have almost doubled to S10.2 billion
in 2018.
Over the next decade, it is expected to rise 3
percent of GDP.
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The Budget 2018 is an intimation that
Singaporeans will need to find more revenue for
healthcare, infrastructure, transport, special
transfers, defense.
The GST is hiked by 2 scheduled for some time
from 2021 to 2025. The excise duty on Tobacco is
increased by 10, effective from Feb 19.
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Major Fund Allocations in Singapore Budget 2018
Sector Funds Allocation
Defense 14.8 billion
Transport 13.7 billion
Education 12.8 billion
Healthcare 10.2 billion
Special Transfers 9.1 billion
The overall expense on the infrastructure is
expected to rise to S20 billion in 2018.
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There are initial casualties of the budget 2018.
The top marginal Buyer's Stamp Duty for
residential properties is hiked from 3 to 4
starting on Feb 20, 2018.
The portion of the value of residential property
in excess of 1 million will be taxed.
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Singapore has substantial reserves that it draws
on to help finance the budget. The interest
earned on the reserves (S16 billion) is the
biggest contributor to the governments revenues.
Mr. Heng is not in favor of such practice. It is
not a long-term solution. He wants it for
emergencies rather than daily spending.
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Mr. Heng said, The government explored all
possible alternatives to increase in GST rate.
However, each option carried pluses and minuses.
The increase in corporate tax, when other
countries are reducing it, could have sent a
negative message to the business owners.
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The budget announced that digital imported
services would be taxed with GST from Jan 1,
2020. It also covers marketing, accounting, IT
and management services.
It covers Netflix and Spotify, apps, listing
fees on electronic marketplaces, software, and
online subscription fees from overseas suppliers
but not e-commerce for goods.
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Mr. Heng has announced one-time payout from the
budget surplus. Depending on their income, the
2.7 million Singaporeans will receive S100,
S200 or S300 in end-2018.
The amount is big enough to kick the consumption
a little bit.
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The budget also announced that the permanent GST
voucher scheme would be topped up by 2 billion
as opposed to last years 800 million. It has
more than doubled the allocation.
It will help households with lower-income to cope
up with the changes in GST. The budget promises
to absorb GST on publicly subsidized education
healthcare as before.
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There is an increase in the foreign domestic
worker levy. It will increase from 265 to 300
for the first foreign domestic worker and from
265 to 450 for the second worker.
It is for those employed without levy concession.
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For employers who do not qualify for
concessions, the levy will be raised to 300 per
month for the first worker and to 450 for the
second helper.
The households with children below 16, seniors,
or disabled persons will continue to get the
concession of 60.
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The budgetary measures also include
incentivizing innovation, new Productivity
Solutions Grant, initiatives to meet climate
change commitments, enhancements to the
Proximity Housing Grant, the tax deduction for
commercial use of intellectual property, an
extension of Wage Credit Scheme.
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Mr. Heng said, The implementation of the GST
hike will depend on the state of the economy,
increase in expenditure, and how buoyant
existing taxes are. It was a difficult decision.
He also cautioned that the Government would need
to do so earlier rather than later.
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Thank You!
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