Budget 2017 Is Here
We know, the Singapore Budget isn’t exactly a riveting topic.
But we think every Singaporean should know a few things about it — namely, what are the things that will benefit us?
When It Happened
The Budget Statement was delivered by Finance Minister Heng Swee Keat on Feb 20, 2017.
Highlights of the new Budget include more support for families and SMEs and an increase in CPF Housing Grants.
In case you missed out on the speech, here are some things that might benefit you:
1. Tax Rebates
Everybody loves paying less tax, and the Government knows that too.
So they are giving Singapore residents who pay tax a personal income tax rebate of 20% of tax payable, capped at $500, for income earned in 2016.
This will cost the Government $385 million — money well spent, we say.
2. Rebates For Service and Conservancy Charges
The rebate for town council service and conservancy charges will be also extended and increased by half a month for financial year 2017.
Eligible Housing Board households will receive 1.5 to 3.5 months of rebates this year; according to Channel NewsAsia:
1- and 2-room flats will get 3.5 months
3- and 4-room flats will get 2.5 months
5-room flats will get 2 months
Executive/multi-generation flats will get 1.5 months
This will cost the government $120 million, and about 880,000 HDB households are expected to benefit.
However, it comes days after the announcement that residents in all 15 town councils run by the ruling People’s Action Party will have to pay more in service and conservancy charges starting in June.
Raising charges, then giving out rebates? It sounds a bit like punching someone and then giving him Tiger Balm.
3. Cheaper Flats For Couples
We knew it would be inevitable that the Government would give people more incentive to get married and have children.
So couples rejoice, again! First-time buyers of resale flats are getting more subsidies.
The Straits Times reported that the Central Provident Fund Housing Grant has been increased from $30,000 to $50,000 for couples buying four-room resale flats or smaller.
Those looking at five-room or larger resale flats will see an increase in grants, from $30,000 to $40,000.
With the Additional CPF Housing Grant and Proximity Housing Grant, these couples can get up to $110,000 in subsidies. The changes take place with immediate effect.
4. More Infant-Care Places
Continuing the incentives for people to have children, families with children under 18 months will be happy to learn about the increase in capacity of infant-care centres.
Channel NewsAsia stated Singapore currently sees 8% of all infants enrolled in infant-care centres.
The government will increase the capacity of such centres to more than 8,000 by 2020.
5. Higher Post-Secondary Bursaries
Annual bursary amounts for post-secondary education institutes will be increased.
Undergraduate students will see an increase of up to $400; diploma students up to $350; and students in ITE (Institute of Technical Education) will get an increase of up to $200, reported Channel NewsAsia.
Approximately 12,000 more Singaporean students are expected to benefit, bringing the total number of beneficiaries to 71,000.
6. New Carbon Tax
Singapore is getting greener, which will be good news to environmentalists concerned about climate change.
Large direct emitters of greenhouse gases can expect to be taxed from 2019.
This will enable Singapore to achieve its commitment to the 2016 Paris climate agreement, according to Channel NewsAsia.
However, the carbon tax imposed on emitters of greenhouse gases like power stations could lead to an increase in electricity prices of between $1.70 and $3.30 per month for an average household in a four-room flat.
New emissions scheme for vehicles is expected to be introduced from 2018, it considers four other pollutants on top of carbon dioxide.
7. Goodies For SMEs
There’s good news for small- and medium-sized enterprises (SMEs), too: a bump in the corporate income tax (CIT) rebate will help firms manage costs.
Those the CIT rebate remains at 50% of tax payable, it will have a higher cap of $25,000, from $20,000, for the 2017 year of assessment, according to Channel NewsAsia.
The rebate will also be extended into 2018, at lower rate of 20% of tax payable, capped at $10,000.
8. Help For Job Seekers
We know it’s tough to find a good job in Singapore nowadays. Budget 2017 seeks to change that with the new “Attach and Train” programme.
It helps workers find jobs in new growth sectors, even though the companies there may not be ready to hire, by helping them get getting training and internships.
There will also be more support for job programmes like the Career Support Programme, Professional Conversion Programme and Work Trial Programme.
To encourage firms to hire older workers, a scheme that offsets 3 per cent of wage for workers who earn under $4,000 monthly, and are not covered by the new re-employment age of 67, will be extended till the end of 2019.
The extension of the Additional Special Employment Credit will benefit about 120,000 workers and 55,000 employers.
The Bad News
Amid the positive measures, however, is one new thing for Singaporeans to grouse over:
Water Prices To Go Up
Water prices will increase by 30% in two phases over the next two years from July 1, 2017, reported Channel NewsAsia.
The increase will be fully phased on Jul 1, 2018 — for 75% of households, the increase will be less than $18; 75% of businesses in Singapore will see an increase of less than $25 a month.
HDB households currently spend about $26 to $49 a month on water.
Today reports that this is the first water price hike in 17 years. Read our story on what opposition politician Chee Soon Juan had to say about the increase.
However, as we have come to expect from Singapore’s Budget, there’s always something to offset any price increase.
To offset the water price hike, there will be measures to help lower- and middle-income households. They can expect a permanent increase in Utilities Save (U-Save) rebates. This is expected to benefit about 880,000 HDB households.
Here’s a graphic that shows how much U-Save rebates your household can get, depending on flat type:
Value’s The Word
According to The Straits Times, Mr Heng mentioned that the government needs to emphasise value-for-money and do “better – and more – with less”.
Meaning the civil service will also face cuts: Ministries will see a permanent 2% cut to their Budget caps, with some of its funds used to execute cross-agency projects.
Four agencies will be affected by the 2% adjustment over two financial years — Home Affairs, Defence, Health and Transport.
We Hope You’re Happy
We hope everyone will find something to cheer about in Budget 2017.
And if not, read our story on what we want to see for Budget 2017 to see where the Government fell short this time.
Featured image from Facebook